Lummis says the CLARITY Act provides strong DeFi protections.
US Senator Cynthia Lammis has rejected complaints that the Digital Asset Market Transparency Act fails to protect decentralized finance creators from regulatory impacts, saying recent changes to the draft would make it the “strongest protection yet for DeFi and developers.”
Her comments on Friday were in direct response to crypto attorney Jake Chervinsky, who said the current bill would weaken the Title 3 Blockchain Regulatory Certainty Act — another crypto bill focused on developer protections — by making non-custodian software developers aware of their customer obligations.
“Don't believe the FUD,” Lummis said, adding, “Over the past few weeks, we've worked bipartisanly to make changes to Title 3. This bill makes the strongest protections for DeFi and developers ever passed. We need to pass the Clarity Act to get these protections.”
Recent changes to the CLARITY Act have not been officially released.
According to Chervinsky, these DeFi protection provisions are heavily overshadowed by the stable coin rewards set out in the CLARITY Act.
The biggest issue with the Senate Banking Committee's latest transparency bill is that Title 3's money transmitter definitions could still expose many non-custodial DeFi developers to liability.
This is because the CLARITY Act includes BRCA in Section 604, which clarifies that unregulated developers and non-custodial software providers should not be treated as financial institutions under the Bank Secrecy Act's KYC obligations.
“The biggest challenge is making sure that non-custodial software developers don't get ripped off as money transmitters,” Chervinsky said.
“This is non-negotiable for DeFi, and it's still not fixed.”
His concerns come amid a flurry of lawsuits and guilty pleas against developers in the US in recent months, including the conviction of Tornado Cash founder Roman Storm in August 2025 for conspiring to operate an unlicensed money transfer business.
Related: Delaware eyes stable coin on licensing framework in banking laws
US lawmakers say the CLARITY Act is moving closer to an expected Senate Banking Committee markup in April after recent bipartisan progress on stablecoin rewards.
Passing the CLARITY Act is essential to ensure DeFi developers have legal protections under the BRCA, Lummis explained.
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