CLARITY bill vote is imminent, Coinbase fights back against Warren

Coinbase Chief Policy Officer Faryal Hirzadeh rejected the idea that the CLARITY Act would weaken U.S. national security. In a July 11 post on Platform X, he said vague cryptocurrency rules allow bad actors to operate outside strict regulatory boundaries. Hirzard believes the bill will bring more digital asset activities into the federal compliance system rather than subject them to fragmented regulation.

Summary

Hilzad said that the CLARITY Act will apply bank-style anti-money laundering rules and give the Treasury Department stronger enforcement tools nationwide.

Warren warned that the current text could retain cryptocurrency loopholes that allow foreign actors to circumvent sanctions.

Senate negotiators hope to introduce a merger draft before recess, but unresolved disputes still threaten final passage.

Hirzad said the proposal would bring cryptocurrency brokers, dealers and exchanges into the scope of obligations under the Bank Secrecy Act. These obligations include anti-money laundering plans, customer identification verification, suspicious activity reporting and sanctions compliance. He also pointed out that the bill contains provisions that allow platforms to suspend suspicious transfers when requested by law enforcement. "This is not a free passport for cryptocurrency," he wrote, calling the proposal a strict security directive.

Warren warns of sanctions evading risks

Senator Elizabeth Warren takes the opposite position. She shared an article written by Richard Neep, former director of Iran affairs at the National Security Council, and wrote: "As currently drafted, the CLARITY Act is a passport to sanctions circumvention." Nape believes that the bill may make some decentralized financial participants outside of clear Bank Secrecy Act obligations, making enforcement more difficult.

At the heart of the controversy is which cryptocurrency companies must register, monitor transactions, and be accountable to federal agencies. Warren and other critics say exemptions for certain unmanaged services could leave loopholes that could be exploited by foreign governments, criminal groups and sanctioned entities. A minority recommendation by the Senate Banking Committee raised similar concerns. Proponents say existing sanctions laws will remain in effect and that the bill will add new powers to the Treasury Department and the Financial Crimes Enforcement Network (FinCEN).

Bill contains new anti-money laundering tools

The Senate Banking Committee's CLARITY Act fact sheet states that the bill applies federal anti-money laundering and counter-terrorism financing rules to centralized digital asset intermediaries. It also created a Treasury authority called Special Measures 6, a tool that would allow officials to take action against foreign jurisdictions, institutions, or transaction types related to the risk of laundering significant digital assets.

The proposal would increase funding for FinCEN, require digital asset companies to implement risk controls and establish information-sharing plans between the government and industry. It will also regulate cryptocurrency self-service kiosks and require research on currency mixers, illegal finance, cyber risks and national security threats. The measures support Hilzard's argument, while the debate over decentralized services supports Warren's call for stricter language.

The Senate faces a narrow legislative window

According to new reports, Senate staff plan to release a consolidated draft of the CLARITY Act during the week of July 13. The new text will combine the work of the Banking Committee and the Agriculture Committee. Negotiators have reportedly added more than 70 pages of content, including stronger consumer protections and changes required in bipartisan negotiations.

Senate leaders aim to hold a possible full vote during the week of July 20, but there are still multiple unresolved disputes. Lawmakers continue to negotiate ethics rules, stablecoin rewards, decentralized financial protection and legal protection for software developers. According to reports, Senator Ron Wyden wants the final bill to retain protections for developers who do not control client funds.

The House approved the earlier version in July 2025, while the Senate Banking Committee approved its draft in May 2026 by a 15 - 9 vote. Both houses must adopt a consistent text before a bill can be submitted to the president. The Senate will begin its summer recess on August 7, leaving limited time for debate and revisions. The national security battle adds another test, as supporters fight to gain enough Democratic votes to pass the bill before lawmakers leave Washington for the summer.