Coinbase rebuts Warren: CLARITY Act strengthens oversight

Coinbase pushed back after Senator Elizabeth Warren warned the CLARITY Act could enable sanctions evasion. On July 11, Coinbase chief policy officer Faryar Shirzad wrote on X that the bill would tighten oversight and strengthen national security protections for the U.S. financial system.

Shirzad highlighted provisions he said would improve enforcement, including tools for the Treasury Department to track and block attempts by foreign adversaries to evade sanctions, increased funding for the Financial Crimes Enforcement Network to target state-linked cybercrime, and authority for crypto platforms to freeze suspicious transactions at law enforcement request.

Warren posted on X on July 8 that, “As currently drafted, the Clarity Act is a ticket to sanctions evasion,” expressing concern that some language in the bill could weaken safeguards against illicit finance.

Senator Cynthia Lummis, a sponsor of the bill, defended the legislation earlier in July, noting it includes 16 safeguards intended to prevent abuse. Lummis also warned that failing to pass the bill could postpone creation of a clear federal framework for digital assets until 2030.

Advocates for the CLARITY Act say the legislation would bring crypto platforms under existing financial oversight and create clearer compliance obligations. Critics contend certain drafting choices could create gaps that sophisticated actors might exploit to move funds around U.S. controls.

Lawmakers are debating whether the bill’s enforcement mechanisms and proposed funding increases are sufficient to address the risks raised by Warren and others. Stakeholders and advocates have warned that without agreement, establishing a durable regulatory framework for digital assets could be delayed for years.