Weakening the developer protections in the CLARITY Act would leave the US trying to regulate a crypto industry it has already helped push offshore, Kristin Smith argued in an opinion essay cited by CoinDesk on June 15.
Smith, president of the Solana Policy Institute, said the bill’s software-focused safeguards are not a side issue. They are the backbone of any credible US market structure regime. If Congress blurs the line between writing open-source code and handling customer money, the country risks treating software builders like money transmitters, she wrote.
The dispute centers on the Blockchain Regulatory Certainty Act, or BRCA, a CLARITY provision that would make clear that people who write open-source software, run nodes or validate transactions are not money transmitters under federal law unless they custody or control customer funds. Smith said that standard is already reflected in 2019 guidance from the Financial Crimes Enforcement Network, and the bill should bring criminal-law treatment into line with that interpretation.
She pointed to a joint letter from crypto founders, executives and investors asking Senate leaders not to dilute the language. The coalition is notable precisely because the firms involved compete for talent, capital and users. They appear to agree on one thing: the US cannot keep its edge if developers face legal uncertainty for publishing software.
Smith also cited the government’s case against Tornado Cash developer Roman Storm as a warning sign. That prosecution has become a flashpoint for the industry, which argues that code publication is not the same thing as moving customer funds. If that distinction disappears, she said, more builders will simply leave. The US share of global open-source crypto developers has fallen to about 19% from 38% in 2015, according to her.
The political stakes are straightforward. BRCA survived committee review, and Smith wants it left intact before the final vote. For traders and crypto companies, the next watch item is whether Senate negotiators preserve the developer language in the closing draft, or whether it gets narrowed enough to revive the offshore migration the industry says it is already seeing.
Solana policy chief urges Congress to keep CLARITY developer shield
Protecting software developers in the US digital-asset law is crucial for maintaining American crypto leadership, according to Solana Policy Institute president Kristin Smith. She urged Senate leaders to keep developer protections intact to avoid weakening the market.