Senate Releases 309-Page CLARITY Act Draft Ahead of May 14 Markup

Highlights:

• Senate leaders released a 309-page crypto bill before the May 14 committee markup.
• The draft clarifies SEC and CFTC roles over crypto assets, trading, and disclosures.
• The bill also covers DeFi, stablecoins, self-custody, customer protection, and anti-money-laundering rules.

Senate Banking Committee Chairman Tim Scott, along with Senators Cynthia Lummis and Thom Tillis, released the 309-page text of the CLARITY Act, a major crypto market structure bill. The text will serve as the base version for the committee’s markup scheduled for May 14. During the markup, lawmakers will review the bill, suggest changes, and vote on whether it should move forward.

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The committee also shared a 10-page summary to explain the main parts of the draft. The bill focuses on how crypto assets are offered, sold, traded, disclosed, and supervised in the U.S. It also seeks to clarify the roles of the SEC and the CFTC. Put simply, the bill aims to make it clear which crypto activities come under securities rules and which come under commodities rules.

🚨 BREAKING: The Senate just released new CLARITY Act draft with a stablecoin compromise allowing activity-based rewards.

Members now have until tomorrow to file amendments before Thursday’s markup. pic.twitter.com/wDLC4oNMjC

— Coin Bureau (@coinbureau) May 12, 2026

Bill Covers Securities, DeFi, Banking, and Stablecoins

The draft includes nine major titles. The first section focuses on securities innovation. It creates rules for “ancillary assets,” which are network tokens whose value may depend on the work of a project team or related people. The draft requires initial and semiannual disclosures for some transactions involving these assets. It also creates a new exemption called “Regulation Crypto”, which would allow some companies to raise money without following the full securities registration process used by public companies.

Under Regulation Crypto, a company could raise the greater of $50 million per year for four years or 10% of the total dollar value of outstanding ancillary assets. However, the gross proceeds cannot exceed $200 million. The company would still need to follow disclosure rules under the draft.

The second title focuses on illicit finance. It would treat digital commodity brokers, dealers, and exchanges as financial institutions under the Bank Secrecy Act. That would bring anti-money-laundering programs, customer checks, and due diligence rules for these firms.

The third title covers decentralized finance, or DeFi. It sets rules for when a DeFi trading protocol may be treated as non-decentralized. It also calls for rules on people who control such protocols. The draft includes guidance on anti-money laundering and sanctions obligations for some U.S.-owned or operated DeFi front ends.

Customer Protection Is a Major Part of the CLARITY Act Draft

The bill also includes banking and stablecoin rules. It says banks and other financial institutions may use digital assets and blockchain for activities they are already permitted to conduct, such as payments, custody, lending, and trading. However, the draft would stop covered digital asset service providers from paying passive interest or deposit-like yield to U.S. customers on payment stablecoin balances.

Another important part is the CFTC-SEC micro-innovation sandbox. This would let eligible firms test new financial products under regulatory oversight for up to two years, with a possible extension. 

The CLARITY Act draft also calls for studies on tokenized securities, automated regulatory compliance, post-quantum cryptography standards, and international cooperation against crypto-related illicit finance.

The bill gives protection to software developers and network participants for some software-related activities. It also includes a safe harbor for nonfungible tokens, unless an NFT project involves an investment contract. 

The “Keep Your Coins Act” section would stop federal agencies from blocking people from using self-hosted wallets to hold their own digital assets, while keeping enforcement powers for money laundering, sanctions, and terrorism financing laws.

The final sections of the bill focus on customer property, education, and coordination between regulators. The draft would treat ancillary assets and digital commodities as customer property in bankruptcy. It would also require the SEC and CFTC to create educational materials for digital asset users.

The bill also creates a joint advisory committee on digital assets and requires the SEC and CFTC to sign a memorandum of understanding for supervision, enforcement, and information sharing. The draft authorizes $30 million per year for five years for FinCEN and gives regulators one year to issue rules. The general effective date would be 360 days after enactment.

Senate Leaders Say the Bill Brings Clarity

Chairman Scott said the bill reflects months of work and would give Americans “clear rules of the road.” He said it puts consumers first, combats illicit finance, and keeps the future of finance in the United States. Senator Lummis said the text brings the crypto industry closer to the clarity it has long requested. Senator Tillis called the updated language a bipartisan compromise that could support innovation in the United States.

If passed, the CLARITY Act could become one of the most important crypto policy frameworks in the United States. It tries to balance innovation, investor protection, banking access, stablecoin rules, DeFi oversight, self-custody rights, and anti-money laundering controls in one large market structure package.

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