Lummis Claims CLARITY Act Has 'Strongest Ever' DeFi Developer Protections — Just Don't Ask to See Them

US Senator Cynthia Lummis has pushed back against suggestions that the Digital Asset Market Clarity Act falls short on protecting DeFi innovators from legal trouble, asserting that recent tweaks to the draft will deliver the "strongest protection for DeFi and developers ever enacted." Because nothing says "trust me, bro" quite like legislation that apparently works its magic in secret. Her remarks on Friday directly addressed concerns raised by crypto lawyer Jake Chervinsky, who contended that Title 3 of the current draft undermines the Blockchain Regulatory Certainty Act — another bill focused on developer protections — by potentially imposing know-your-customer obligations on non-custodial software developers. "Don't believe the FUD," Lummis stated, noting that bipartisan work over recent weeks had resulted in changes to Title 3 making this legislation the strongest protection for DeFi and developers ever enacted. Ah yes, the classic "don't read the fine print" defense — a time-honored tradition in both crypto and Washington. The CLARITY Act must pass to secure these protections, she added. The latest revisions to the CLARITY Act have not been made public. Because if there's one thing regulators love more than protecting innovators, it's protecting them from the dangerous act of reading what the laws actually say. Chervinsky observed that these DeFi protection provisions have taken a back seat to the intense discussion around stablecoin yield provisions in the CLARITY Act. Apparently, the real regulatory emergency was ensuring your USDC can still chase 4% yields while developers wonder if they'll be wearing orange jumpsuits. His primary concern with the Senate Banking Committee's latest draft is that Title 3's money transmitter definitions could still leave many non-custodial DeFi builders exposed to liability. This persists despite the CLARITY Act incorporating the Blockchain Regulatory Certainty Act in section 604, which clarifies that non-controlling developers and providers of non-custodial software should not be treated as financial institutions subject to Bank Secrecy Act KYC obligations. "The biggest challenge is ensuring non-custodial software developers aren't misclassified as money transmitters," Chervinsky argued. "That's non-negotiable for DeFi, and it's still unsettled." Imagine building a protocol that nobody controls, only to discover the government thinks you're a bank — the ultimate rug pull by bureaucracy. His concerns follow several high-profile prosecutions and convictions of developers in the US in recent months, including Tornado Cash co-founder Roman Storm, convicted in August 2025 of conspiracy to operate an unlicensed money transmitting business. Nothing like a conviction to really clarify whether code is speech, property, or apparently a money service business. Lawmakers