Final CLARITY Act Packs 126 Changes Requested by Senate Democrats

What the 126 Democrat-Requested Changes Cover

The 126 changes are revisions to the existing CLARITY Act rather than a separate legislative package. They modify how federal agencies would classify and oversee digital assets and what obligations would apply to token issuers, exchanges, banks, developers, and government officials. Senate Banking Digital Assets Subcommittee Chair Cynthia Lummis of Wyoming, Senate Agriculture Committee Chairman John Boozman of Arkansas, and Senate Banking Committee Chairman Tim Scott of South Carolina released the final CLARITY Act text on Sept. 14.

An accompanying list divides the 126 requested changes among the Banking Committee, Agriculture Committee, and ethics portions of the bill. Banking provisions cover token classifications, SEC oversight, illicit finance, DeFi, banks, developers, and consumer education. Agriculture provisions govern CFTC jurisdiction, exchanges, brokers, custody, capital, and trading conduct. The ethics changes restrict officials’ digital asset interests and establish penalties and enforcement mechanisms.

For token issuers, the revisions replace a technology-neutral approach with a Network Token framework focused on tokens tied to distributed ledger systems. Issuers seeking Regulation Crypto treatment or public resale would first certify to the SEC that their assets qualify as ancillary assets rather than securities. The changes also expand anti-evasion and disclosure requirements, mandate delisting after specified disclosure violations, and preserve SEC authority over fraud and market manipulation.

Fundraising and Illicit-Finance Rules Tighten

Among the issuer-related revisions, the proposed Regulation Crypto fundraising limit falls from $75 million to $50 million annually, with a new $200 million lifetime ceiling. Certain ownership-based resale restrictions would be tightened, while issuers raising more than $25 million would need audited financial statements. Certain felony convictions involving financial crime, cybercrime, money laundering, or terrorist financing would disqualify applicants for 10 years.

Changes addressing illicit finance would classify digital asset intermediaries as financial institutions under the Bank Secrecy Act and establish risk-based compliance examinations. They also add federal protections for crypto ATM users, require protocols that do not qualify as decentralized to follow securities and anti-money laundering rules, and impose sanctions compliance on front-end decentralized finance platforms.

The Republican tally reached 126 after Lummis disclosed more than 100 changes requested by Democrats on Sept. 10, while the measure still faced an uncertain 60-vote test. Lummis characterized the completed draft more broadly:

“This text is truly bipartisan and includes more than 120 of Democrats’ demands.”

CFTC Oversight and Exchange Rules Expand

Another group of the 126 revisions broadens the proposed definition of a digital commodity to include meme coins, network tokens, and ancillary assets. They would allow the CFTC to regulate nonfungible token trading when conducted similarly to digital commodity transactions and require protocols that do not qualify as decentralized to register as intermediaries. The regulated activities include cryptocurrencies and other digital assets, as well as exchange operations.

Exchange provisions add stricter rules for affiliate trading, conflicts of interest, best execution, customer disclosures, and custody of customer funds. Platforms would need systems for accessing private keys and periodically testing access and transfer capabilities, submit certified annual financial statements, and avoid listing assets readily susceptible to manipulation. Exchange-issued digital commodities could not be counted toward regulatory capital requirements.

CFTC provisions would authorize $150 million in appropriations and establish a volume-based fee structure. Other additions include large-trader reporting, whistleblower protections, a private right of action, and a new Office of the Retail Commodity Advocate. Exchanges offering direct retail access would provisionally register with the National Futures Association and follow specified consumer protection standards.

Banking, Developer, and Ethics Changes Take Shape

The remaining groups of changes address concerns raised during negotiations over stablecoins and software liability. The release states that Treasury would receive authority intended to prevent deposit flight tied to payment stablecoins. Changes to the Blockchain Regulatory Certainty Act would establish a civil safe harbor for developers without displacing derivatives regulation or existing CFTC authority.

Separately, the ethics division would restrict federally elected officials, senior executive branch officials and employees, and federal judges from issuing or sponsoring digital assets or holding significant financial interests in issuers. It would increase civil monetary penalties enforced by the Justice Department, revise financial disclosures, provide an enforcement role for state attorneys general, and take effect one year after enactment.

The final text also preserves specified state consumer protection laws and gives state attorneys general a role in enforcing the ethics provisions. However, a bipartisan coalition of 18 attorneys general opposed the CLARITY Act on Sept. 14, arguing that broader preemption language could weaken state authority over crypto fraud, registration, and investor protection.

Sept. 15 Vote Tests Support for the Revised Bill

Tuesday’s first Senate test will determine whether lawmakers can move toward considering the measure, not whether they pass it. The official Senate schedule sets the cloture motion on proceeding to H.R. 3633 for 2:15 p.m. Sept. 15. Cloture generally requires 60 votes, leaving Republican leaders dependent on Democratic support.

Political uncertainty remained high before the final draft appeared, with lawmakers and industry observers questioning whether supporters could reach the procedural threshold. Claims that the CLARITY Act was effectively dead in Washington reflected that skepticism as the scheduled vote approached.

Floor action follows the Senate Banking Committee’s 15-9 bipartisan vote to advance the measure in May. If cloture is invoked, the final legislative text would be offered as a substitute amendment, opening Senate debate rather than approving the bill or sending it directly to the president.