White House to Senators: Hands Off Our Code, Or Innovation Flees Overseas

The White House has thrown its weight behind the crypto industry's push for DeFi software developer protections. On Friday, Trump's crypto advisor, Patrick Witt, called developer protections "one of the most important aspects" of the CLARITY Act, the broader crypto bill currently under Senate review. Witt warned that outlawing code would only push financial innovation offshore—just what we need, more degens building from a beach in Bali instead of a basement in Baltimore.

The proposed developer protections, outlined in the separate Blockchain Regulatory Certainty Act (BRCA), aim to stop non-controlling developers from being classified as money transmitters. Senator Cynthia Lummis introduced the proposal back in January 2026. The BRCA bill will be folded into the CLARITY Act ahead of the expected Senate markup in late April. Because nothing says "regulatory clarity" like stuffing two bills into one and hoping nobody notices.

There had been speculation that these protections might get axed as part of a compromise to move the CLARITY Act forward. Lummis shut down those rumors. Witt's recent statement reinforces that the protections remain intact. Consider the FUD officially dispelled, at least until the next Twitter panic about something else entirely.

The crypto industry largely celebrated the White House's support. Kristin Smith, president of the Solana Policy Institute, dubbed the protections "foundational." Peter Van Valkenburgh, executive director of Coin Center, put it bluntly: "If you outlaw code, you victimize innocent developers, discourage legitimate users, and leave the most powerful tools to criminals. No market structure bill without BRCA." That's the kind of quote that gets printed on t-shirts and laser-etched onto hardware wallets.

Some in the community weren't entirely convinced, noting that if the Administration were truly serious about developer protections, it would have pardoned Roman Storm, founder of Tornado Cash. Nothing says "we love builders" quite like leaving one of the most famous DeFi devs to rot in legal limbo. The cognitive dissonance is deafening.

Meanwhile, TD Cowen warned that the stablecoin yield stalemate could derail the CLARITY Act this year. The investment bank projected the bill might get revisited in 2027 after the November midterms. So basically, we're looking at another two years of regulatory purgatory while stablecoins continue printing yield that nobody fully understands.

Key dates to watch: late April for a potential Senate Banking Committee markup, and late May for the final Senate floor vote. No progress by May means likely pushing to 2027. Set your calendar alerts now, or don't—either way, Congress will probably find a way to delay it anyway.