Historically, the United States has been the world’s leader in financial innovation, but the Biden administration’s hostility to digital assets weakened the United States’ leadership. The Biden administration targeted the digital asset industry and failed to protect investors or provide clear rules of the road.
Instead, the administration favored regulation by enforcement, taking multiple enforcement actions against digital asset companies for failing to comply with unclear standards, forcing entrepreneurs and innovators abroad.
America is the global leader in financial services, and with that enormous privilege comes a duty to encourage innovation. From the creation of modern capital markets to the internet revolution, we have set the standard that others follow. Congress has taken an important first step in enacting the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act for payment stablecoins. But lasting regulatory clarity for digital assets will require comprehensive market structure legislation that draws the line between securities and commodities, creates a regulatory framework for digital asset exchanges, and provides legal certainty for innovators while protecting investors.
Clarity matters not just for companies, but for families and small businesses who deserve transparency, fairness, and accountability when they invest their hard-earned money. Strong disclosure rules, anti-fraud protections, and clear oversight are essential to building trust in these new markets and making sure every day Americans can participate safely.
President Trump will not cede the responsibility to produce common sense and balanced regulations to other nations, and he recognizes that American innovators need clear, predictable rules to compete and succeed in the global economy. We cannot allow adversaries to capitalize on our nation’s previous inaction and establish themselves as the global leaders in this transformative technology.
That’s why this week represents a watershed moment. After countless hours of stakeholder and expert engagement and months of running a transparent, bipartisan process, we are finally marking up the CLARITY Act in the Senate Banking Committee. First introduced in 2022 as the Lummis-Gillibrand Responsible Financial Innovation Act, this legislation brings us one crucial step closer to providing the clarity and certainty that American innovators desperately need and deserve.
This bill is the culmination of months of relentless bipartisan effort. In July, Tennessee Republican Sen. Bill Hagerty and Ohio Republican Sen. Bernie Moreno joined us in introducing a discussion draft and invited stakeholders to help us get this right. The response was overwhelming – hundreds of companies, advocates, and experts provided thoughtful feedback and suggestions. And we listened and released a second discussion draft in September.
Through passionate but productive negotiations across the aisle, we’ve crafted legislation that reflects broad bipartisan priorities and enthusiastic backing from the innovators and builders in this industry. This legislation provides clear disclosure requirements for digital asset transactions, modernizes banking regulations to permit digital asset activities and prevent future choke points, and creates pathways for innovators to test new ideas without drowning in compliance costs.
It also takes a hard line against illicit finance by giving law enforcement targeted tools to fight money laundering, terrorist financing, and sanctions evasion while keeping legitimate activity under U.S. oversight. That balance protects civil liberties while strengthening national security.
This is our opportunity to welcome innovation back to American shores. The United States possesses unparalleled advantages: the deepest capital markets, the strongest rule of law, the most dynamic entrepreneurial culture, and the world’s reserve currency. We are uniquely positioned to lead in this space, but that’s only if we act.
This is a critical moment that we will look back on years from now – and we must get it right. Let’s ensure that America continues to lead in financial innovation, not follow. The world is watching, and the future of American competitiveness depends on our choices today.
South Carolina Republican Sen. Tim Scott chairs the Senate Banking Committee. Wyoming Republican Sen. Cynthia Lummis chairs the Subcommittee on Digital Assets on the Senate Banking Committee.
The views and opinions expressed in this commentary are those of the author and do not reflect the official position of the Daily Caller News Foundation.
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