CLARITY Act Faces Fresh Law Enforcement Pushback as Trump Considers Bipartisan Ethics Deal

The CLARITY Act proposal has once again drawn opposition from an interested party, specifically the National Sheriffs’ Association (NSA) which has raised objections over one of the provisions that may hamper the fight against financial crimes committed through digital assets. This new opposition comes at a crucial time when the U.S. President Donald Trump is said to be looking into a bipartisan ethics agreement that can pave way to a vote on the bill within the coming week in the Senate.

Through a letter to Senate Majority Leader John Thune and Senate Minority Leader Chuck Schumer, the National Sheriffs’ Association raised objections against one provision of the Blockchain Regulatory Certainty Act (BRCA), which is one of the parts of the CLARITY Act. The objection revolves around how this provision may offer exemptions that may be used by criminals to commit their financial crimes through digital currencies.

According to the association, the exemption of developers of DeFi protocols from the liability will hinder the ability of law enforcement authorities in identifying any financial crimes that may be committed before such activities take place. They fear that those platforms that may hide cryptocurrency transactions from anyone may become very appealing to money laundering, fraudsters and other criminal groups.

On the part of the proponents of the BRCA, the developers of decentralized blockchain applications should not be treated as financial intermediaries just because of software publication and creation of protocols.

This is part of the general problem facing lawmakers in developing a legal framework that may encourage innovations in this sector while protecting consumers in the process. The success of the bipartisan ethics discussions on this piece of legislation will decide whether the bill moves to a full Senate vote.

JUST IN: National Sheriffs’ Association warns Clarity Act poses risks. 👀

Their claims:

– DeFi exemptions from AML & sanctions.

– Exemption for mixers & non-controlling developers.

– Reduced recovery of stolen assets and victim protection.

🫡 @Jasper_Goodman pic.twitter.com/LmjUHXWRq7

— Bitcoin Archive (@BitcoinArchive) July 31, 2026

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