The World Is Writing Rules For Digital Assets – US Cannot Fall Behind

While Congress debates whether to regulate digital assets, the rest of the world has stopped debating and started building. In the last two years, nearly every major financial center has adopted, or is finalizing, a comprehensive framework for digital assets. The United States, which has long set the global standard in finance and innovation, is now the conspicuous holdout. Congress can close that gap by passing the CLARITY Act, and the time to do it is now.

The European Union’s comprehensive crypto regime, called Markets in Crypto-Assets Regulation (MiCA), is fully in force this summer, and firms must be licensed to serve European customers. The United Kingdom finalized its rulesthis year, with a mandatory authorization regime taking effect in 2027. Japan just moved to reclassify digital assets as financial instruments, bringing them into a defined regulatory perimeter. Singapore’s licensing regime for digital token service providers is already in effect. The United Arab Emirates has established a comprehensive framework, and Hong Kong and Australia have each advanced regimes of their own. Every one of these jurisdictions has done what the United States has not: given businesses and consumers clear rules of the road.

The consequences of our inaction are not hypothetical. Approximately 88% of centralized crypto exchange trading already occurs outside the United States, much of it beyond the reach of American regulators. This leaves Americans with fewer protections if they choose to participate.

Capital, activity, and talent follow regulatory clarity, and when we fail to provide it, we do not stop this market from growing overseas. We simply force it offshore to jurisdictions that were happy to write the rules we would not.

The members of our organization include, among others, the builders and entrepreneurs working on this technology. It allows us to see the risk as clear as day. 

Software developers can work from anywhere in the world, and they will locate where the law gives them room to operate without fear of liability for simply writing code. The American share of global crypto developer talent has dropped 50% in a decade. Now, 80% of crypto developers live outside the U.S. 

Congress can create jobs and spur growth through the CLARITY Act. CLARITY would help by providing tailored protections for developers, drawing a sensible line between those who control customer funds and those who merely publish software. Without these protections in federal law, we should not be surprised when the next generation of builders, and the companies and jobs they create, choose Lisbon, London, or Singapore over San Francisco, New York, or Miami.

This is not, as critics sometimes suggest, a niche concern for crypto-native firms. Businesses of every kind now support a clear federal framework because they are engaging with this technology. Banks are building tokenized deposits, settlement networks, and custody solutions. Asset managers are putting funds and Treasuries on-chain. Payments companies, retailers, and market infrastructure providers are building new functionalities and services with digital assets and blockchain payment rails. A durable framework and robust consumer protections benefit all stakeholders, and that broad coalition is precisely why this issue has drawn support across the political spectrum.

We have begun to see what benefits regulatory clarity can provide U.S. companies and customers. Since the passage of the GENIUS Act last year, transaction volume on the largest U.S. based stablecoin issuer grew 263% year over year as of Q1 2026, reversing the prior dominance of foreign-issued USD stablecoins in payments, according to Visa. The GENIUS Act, however, only addressed one corner of the market. 

To be clear, CLARITY strengthens oversight and raises the floor for the entire market. The bill draws bright lines that define the authority of the Securities and Exchange Commission (SEC) over digital asset securities and, for the first time, provides the Commodity Futures Trading Commission (CFTC) with spot-market supervisory authority over digital commodities – establishing clear and robust investor safeguards. CLARITY further tailors protections to digital assets’ actual characteristics and risks, requires comprehensive disclosures, establishes clear business conduct standards, confirms that a security does not stop being a security simply because it lives on a blockchain, and more. It brings intermediaries under real customer-protection, custody, and anti-fraud requirements. Simply put, it delivers the two things that have always gone together in American markets: strong consumer protection and clarity for innovation to flourish.

Regulatory inertia is an active economic choice, and its costs are rising daily. Every month that passes without clear federal rules tells the world’s leading software engineers, entrepreneurs, and capital allocators that their future lies elsewhere. The U.S. does not need to compromise consumer safeguards to remain competitive; it simply needs to provide certainty. Congress has a clear mandate and a workable solution in the CLARITY Act. It is time to pass the bill and secure America’s financial future.

This article was originally published by RealClearPolitics and made available via RealClearWire.