Written by Martin Youngstaff writerReviewed by Felix Ngstaff editor

Written by Martin Youngstaff writer

Reviewed by Felix Ngstaff editor

Catholic leaders, US authorities challenge CLARITY Act over illicit activity

Latest NewsPublishedJun 24, 2026

US Authorities and Catholic Leaders Voice Concerns Over CLARITY Act

The CLARITY Act, a bill aiming to establish a regulatory framework for digital assets, is facing opposition from law enforcement organizations and Catholic leaders. They argue that the bill could create oversight gaps, hindering investigations into illicit activity and potentially harming public safety. The law enforcement groups, including the National District Attorneys Association and the National Sheriffs’ Association, expressed concerns that the bill’s provisions could weaken Know-Your-Customer and Anti-Money-Laundering requirements.

A coalition of Catholic organizations, including the Alliance to End Human Trafficking, also raised concerns about the bill’s potential impact on human trafficking. They argue that certain provisions could create “broad carveouts and regulatory ambiguities” that may make it more difficult to monitor illicit financial activity tied to trafficking and other forms of abuse. In contrast, proponents of the bill, such as Senator Cynthia Lummis, argue that it will help close gaps exploited by criminals and provide clarity for builders in the digital asset space.

Implications for Earning and Passive Income

The debate surrounding the CLARITY Act has significant implications for individuals looking to earn passive income through digital assets, such as those offered by EcoPool. As the regulatory landscape for digital assets continues to evolve, it is essential to consider the potential risks and benefits of investing in these assets. EcoPool, a platform that allows users to earn rewards through cloud mining, offers a unique solution for those looking to generate passive income. By using EcoPool, individuals can earn $ECP, which can be used to purchase goods and services or held as a store of value.

In the context of the CLARITY Act, it is crucial to consider how regulatory changes may impact the ability to earn passive income through digital assets. As the bill moves forward, it is essential to monitor its progress and understand how it may affect the digital asset space. For those looking to earn passive income, EcoPool remains a viable option, offering a secure and transparent way to generate rewards through cloud mining.

Conclusion

The CLARITY Act’s fate remains uncertain, with law enforcement organizations and Catholic leaders voicing concerns about its potential impact on illicit activity and human trafficking. As the bill moves forward, it is essential to consider the implications for earning passive income through digital assets, such as those offered by EcoPool. By staying informed and adaptating to regulatory changes, individuals can continue to generate passive income through EcoPool and other digital asset platforms. To start earning with EcoPool, download the EcoPool app and begin generating rewards today. The EcoPool app offers a user-friendly interface and secure way to earn $ECP, making it an excellent option for those looking to generate passive income.

The letter said there was no concern with individuals who write or publish software code or with responsible technological innovation, but with exemptions on crypto transactions that may affect law enforcement’s ability to investigate. 

“Our concern is with broad exemptions that may shield individuals or entities whose activities facilitate the movement of digital assets, create obstacles to legitimate oversight, or weaken longstanding investigative and enforcement authorities relied upon by law enforcement.”

However, Lindsay Fraser, chief policy officer at the Blockchain Association, said the letter showed a “fundamental misunderstanding” of the CLARITY Act. 

“Section 604 does one narrow thing,” she said. “It prevents non-custodial software developers from being misclassified as money transmitters when they do not custody assets or control transactions.”

“It does not immunize criminals. It does not limit sanctions enforcement. It does not stop prosecutions for money laundering, fraud, or terrorist financing.”

Anti-trafficking advocates push back

Meanwhile, the Alliance to End Human Trafficking sent a similar letter Tuesday to Senate Republican Leader John Thune and Senate Democratic Leader Chuck Schumer, also flagging Section 604 but from a human rights abuse perspective. 

Related: Crypto isn’t the problem with the US economy, says senator

Certain provisions under Section 604 could create “broad carveouts and regulatory ambiguities” that may make it “more difficult to responsibly monitor illicit financial activity tied to trafficking, organized crime, child exploitation, sanctions evasion and other forms of abuse,” it said. 

“The test of any financial system is not simply whether it generates wealth or innovation, but whether it safeguards human life and dignity.”

Screenshot of June 23 AEHT letter. Source: Punchbowl News

CLARITY Act proponent Senator Cynthia Lummis took the opposite view, stating Thursday that “Regulatory ambiguity doesn’t just hurt builders. It helps criminals… The CLARITY Act closes the gaps bad actors exploit.”

“The CLARITY Act is clear: writing code is not money transmission. That distinction will matter for a generation of builders,” she added on Tuesday. 

Magazine: Japanese pension fund tips 1% in crypto, G7 urges action on NK hackers: Asia Express

Cointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.

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