The most important development of the last two weeks is probably the publication of a revised bill on the structure of the Bipartisan digital asset market in the Congress, which now gives real impulse to the possibility of complete legislation. At the same time, the SEC continues to reposition its posture, drawing aggressive litigation, recognizing areas outside of its jurisdiction such as the establishment and signaling of a more measured approach while we are waiting for the first report of its new Crypto working group. Meanwhile, the courts continue to shape the legal limits of decentralized finance, as seen in the accusations of reversal of the decision closely observed in the mango market case.
These developments and some other short notes are discussed below.
Structure of the Bipartite Market (“Clarity Act”) Text of the published bill: May 29, 2025
Background: After having published the language of the bill of a bill on the structure of the unnamed market a few weeks ago, a revised and now entitled version, the Clarity Act, abandoned last week. Sponsored by the president of the House Financial Services Committee French Hill, the bill has five republican co-sponsors and three Democrats, all members of the Chamber of Financial Services or Chamber Agriculture Committees. It should be accelerated for markings within the Financial Services Committee, from June 10thSo it could move quickly in the committees. The wider house calendar, however, remains unclear, because the attention of the congress is divided between many competing priorities beyond the regulation of digital assets.
Analysis: The sponsors seem to have seriously considered the comments of the industry, and several problems specific to the technology reported in the previous version have been treated significantly. For example, many highlighted the definition of the “decentralized financial trading protocol”, previously criticized as too wide, has been revised and now more closely follows the probable intention of the editors. There was an audience earlier this week at the House Financial Services Committee (which we will cover in the next bihebdomedary update), which was designed to discuss the regulation of digital assets more widely but was also strongly focused on this bill.
Dry pays the advice according to which certain activities to highlight the proof of the participations do not imply the laws on securities: May 29, 2025
Background: The dry division of companies’ finance has published a “declaration on certain activities of putting the protocol” clarifying its opinion according to which certain “stimulation” activities of the blockchain protocol of proof of proof are not transactions of securities within the framework of federal securities laws. This follows related advice on the exploitation of proof of work that was published in March. “Consequently, it is possible that the participants in the activities of standing in the standby the protocol do not need to register with commission transactions under the securities law or to be in one of the exemptions from the law on the securities of the registration in the context of these activities for implementing the protocol.”
Analysis: This probably opens the way to the implementation of ETH and other ETFs linked to blockchain assets of proof of assistance, which can be approved in the near future (although there are still problems of tax law and other titles which could complicate this). We do not know how this could affect the consent of Kraken previous Kraken, because many cleansing services offered by Kraken now seem to be “auxiliary services” under this direction. It is great to see all these advice come out, but until the directives are formalized in regulation or until there is an action of the congress in this field, then the industry is found with little or not, these points of view will continue under different leadership.
The dry moves to reject the Binance affair with prejudice: May 29, 2025
Background: The SEC asked the court to reject the agency’s file against the various entities of Binance and its founder, Changpeng Zhao (“CZ”), with prejudices, which would end the affairs subjected to the previous administration against the greatest exchanges of American digital networks, which we have covered on Le Biblog. This follows the business against Coinbase and Kraken and the closing of investigations on Opensea, Circle and other short time after the change of administration and resignation of the previous president of the SEC, Gary Gensler.
Analysis: As we noted in our dilapidation of digital end -of -year assets in 2024, the cases against various exchanges were disputes between the company for all the exchanges pursued. If it were judged that sales on extremely common as soil token platforms were titles transactions, which would have made most of the individuals to transform in digital assets in the United States, in particular those who lack experience in interaction with decentralized finances. With these prosecution behind the exchanges, all eyes turn to formal advice and SEC / CFTC regulation and if there will be complete legislation of the digital assets of the Congress, which is currently examined by the two chambers.
Conviction reversed in the exploit mango markets: May 23, 2025
Background: The district court judge Arun Subramanian, canceled the fraud convictions against the Mango markets, the operator Avraham (“AVI”) Eisenberg, judging that the place was inappropriate because there was no evidence that the Avi trading engine was in New York. The most interesting decision, however, was to note that there was not enough evidence of falsity to support a fraud accusation by wire (see the decision starting at p. 26). The Court ruled that because the terms and conditions of the user did not intend to reimburse a condition for the loan, and because Avi has made no false representation concerning the value of his assets (he simply exploited an oracle to make these false representations for him), the government could not support a condemnation for fraud, the decision “(o) na na supports the algorithm to measure the real value of his guarantee. »»
Analysis: This case raises wider questions on the level of human interaction necessary for “wire fraud”, where alleged fraud is mainly perpetrated against an algorithm and not a person. There remains the question that Avi continued Numeris, Ltd. Before the mango markets negotiate on activities, saying that it was fraud for others to artificially increase the price of tokens to borrow against knowingly swollen values, similar to what AVI did in its feat. It seems falsified to claim that “the code is the law” for its actions when it asked the government to save its funds when a protocol he used had a similar feat. Avi is still going to prison for other charges he pleaded guilty. It will be interesting to see how the jurisprudence concerning the extent “Code-Is Law” is due to the use of protocols without authorization.
Briefly noted:
Reserve updates 401K and Bitcoin: The Ministry of Labor has retracted the directives discouraging retirement managers to consider cryptocurrency as an investment option in plans 401 (K). This came while Whitehouse Crypto Czar David Sacks was during a large Bitcoin conference in Vegas where he explained how the Bitcoin Strategic Reserve announced.
The ban on reputation risks adopts the Chamber Committee: The Chamber’s Financial Services Committee has advanced on a bipartite vote of 33-19
Updates of the dry Crypto working group: The SEC should publish its first report by the Crypto Task Force in the coming months; Meanwhile, Commissioner Peirce delivered an excellent discourse on the importance of the SEC establishing clear rules of the road for space (especially where the dry has no skill).
Emmer and Torres reintroduce the law of the law to code: Tom Emmer (R-MN) and Ritchie Torres (D-NY) have reintroduced legislation that would protect developers from developers of software and non-guardian blockchain suppliers of the classification of silver issuers. It would be huge to convince the developers to stay in the United States during the development of technologies compatible with blockchain.
CFTC US Persons Guide: The CFTC has published useful advice on what they consider as American people subject to the jurisdiction of the CFTC at a time of the Internet. These directives provide that when the company’s high -level officers direct, control and mainly coordinate the activities of the company is the most important to determine whether the company is considered a national entity for the jurisdictional purposes of the CFTC.
CEO of Safemoon was found guilty of fraud: Braden Karony, the former CEO of Safemoon, was sentenced for three fraud chiefs after being tried for having diverted millions of token, which, according to him, were “locked up” and sold these tokens for personal purposes.
Status of the law on investment companies of ETF questioned: The dry division of investment management, in a letter to an Crypto ETF operator, said that, in the light of recent developments, it is not certain that ETFs are investment companies that can register under the 1940 investment companies Act. Generally, a company would not be an investment company if, among other things, less than 40% of its assets made up of investment values. Registration declarations, demand requirements and current report requirements are different for investment companies and other issuers, and certain cryptographic ETFs (including Bitcoin ETF) are already registered as non-investment companies. This calls into question if the dry could explore the changes of rules more suited to this type of entity.
Conclusion:
These developments mark a potential turning point in the regulatory landscape of digital assets. With the Congress which goes forward on bipartite legislation such as the Clarity Act and federal agencies such as the SEC and the CFTC emitting significant guidelines (if they are always preliminary), the elements of a more coherent framework begin to take shape. However, the regulatory environment remains fragmented and uncertain, in particular in the absence of formal regulations or statutory clarity. While agencies change their orientation and the courts weigh on key matters, market players should remain vigilant, engage with regulators and prepare for a rapidly evolving legal landscape where the border between the code and the law continues to be tested.
