Wyden Urges Senate to Keep Developer Protections in CLARITY Act

The letter argues that the language aligns with existing policy at the U.S. Department of Justice and the Financial Crimes Enforcement Network. Acting Attorney General Todd Blanche previously said developers with no involvement in criminal conduct would not face prosecution. Wyden said the law would let law enforcement focus on unlicensed money transmitters while giving code writers legal certainty.

Developer liability has been one of the most contested parts of the Senate’s market structure bill for months. In March, Sen. Cynthia Lummis dismissed concerns from crypto lawyer Jake Chervinsky that Title 3 could still expose some non-custodial developers to money transmitter rules. Lummis said bipartisan revisions would create “the strongest protection for DeFi and developers ever enacted.” A month later she said she was working on additional changes to clarify how assistance in illicit activity should be interpreted and whether safe harbour periods should apply to newly launched protocols.

Industry groups have backed Section 604, arguing it would reduce legal uncertainty for open-source projects and discourage blockchain companies from moving overseas. Some law enforcement organisations and Catholic leaders have warned the measure could weaken efforts to investigate human trafficking and other financial crimes. Senate negotiators are also still trying to resolve disagreements over ethics rules tied to public officials with digital asset interests, and separate discussions continue over stablecoin yield rules that have divided banks and crypto companies.

The CLARITY Act needs to move through committee and win floor time before Congress leaves Washington in August. With elections approaching, the legislative calendar is tight. Wyden’s letter was the latest attempt to lock in developer protections before the negotiating window closes.