CLARITY Act Could Unlock 11 Crypto Activities for US Banks Under Senate Plan

The Congressional Research Service reports on opportunities that would be created for US lenders under the CLARITY Act as reported by the Senate and passed by the House in H.R. 3633. 

A Sept. 30 Congressional Research Service report enumerates 11 ways in which digital asset activities could be permitted for US lenders. These include underwriting and trading digital assets.

CRS said the Senate version would allow banking companies and credit unions to act in certain ways without maintaining the distinction between insured banks and subsidiary companies under common ownership. Certain actions allowed under the Senate version are not currently permitted for banks. 

Under current law, banks can underwrite and trade limited types of securities. Under the Senate version, banking companies and credit unions could underwrite and trade more types of digital assets.

House and Senate CLARITY Act Versions Take Different Paths

The House bill is more limited. It would permit banks to apply blockchain and other digital technologies to existing activities. Other crypto activities would be authorized for nonbank subsidiaries of financial holding companies.

The Senate-passed bill would allow 11 activities for banks and credit unions. According to CRS, the Senate bill makes no distinction between activities classified as the “business of banking” and activities classified as “financial in nature.”