digitalassets

A new digital assets bill was released in Washington on Monday evening, aiming to overhaul federal restrictions that have so far prevented Federal Reserve banks from offering any digital-asset services to either individuals or institutions.
The proposal, titled the Digital Asset Market Clarity Act, was introduced by Cynthia Lummis, a member of the Senate Banking Committee and one of the most vocal advocates for crypto legislation in Congress. Lawmakers backing cryptocurrencies are seeking to amend the Federal Reserve Act to prohibit central bank digital currencies (CBDCs) from being used for monetary policy purposes.
According to Eleanor Terrett, host of the Crypto In America podcast, the bill proposes changes that would directly affect the Federal Reserve System, including limitations that would prevent banks from offering certain products or services directly to consumers.

Senate Banking Committee Adds Ethical Provisions to the Bill
A 278-page draft shared by Terrett shows that the proposal includes two new ethical provisions under the jurisdiction of the Senate Banking Committee. These provisions address convictions for serious criminal offenses and insider trading.
Sections appearing on pages 72 and 270 were initially absent from the versions that first reached Capitol Hill. Their omission was due to the fact that ethical standards are typically handled by other congressional committees and were not expected to appear in related crypto legislation released elsewhere.

A Compromise Between DeFi and Traditional Finance
The bill also introduces a compromise between decentralized finance (DeFi) and traditional financial interests, outlined in Section 601. This section is widely known as the Blockchain Regulatory Certainty Act (BRCA) and focuses on protecting software developers.
Sources familiar with the negotiations said the agreement was reached earlier this week following a series of tense private meetings held the previous week. Banking institutions and opponents of the Clarity Act, including securities industry trade groups such as SIFMA, had warned that DeFi protocols contain regulatory “gaps” that could give them an unfair advantage over traditional financial firms.
Senator Lummis wrote on X that after months of intensive work, a bipartisan text is now ready for a vote scheduled for Thursday. She urged her Democratic colleagues not to abandon the progress made, arguing that the legislation would provide the clarity needed to keep innovation in the United States while strengthening consumer protection.

The Bill Defines “Ancillary Assets” and Early-Stage Tokens
One of the bill’s central features is the introduction of “ancillary assets” and early-stage tokens. This classification applies to digital tokens issued during early fundraising phases on blockchains that later evolve into full network tokens.
While the proposal states that these assets are not securities on secondary markets, ancillary assets would be treated as “covered securities” for the purposes of federal preemption. Issuers and related parties would still be required to provide detailed disclosures during initial transactions.
Under the framework, the Securities and Exchange Commission (SEC) would require disclosures related to token offerings, governance rights, technical capabilities, and individuals associated with the token. The stated objectives are to protect investors, support capital formation, and maintain fair and orderly markets. The SEC would also oversee the listing of “privatized” tokens and police insider trading.
Section 103 expands this framework further by granting the SEC authority to create exemptions and tailored rules for transactions involving ancillary assets. Tokens sold under the new crypto regulatory regime could qualify for exemptions that override state securities laws, though the SEC would retain discretion over which transactions qualify and under what conditions.

BRCA Provides Legal Protection for Blockchain Developers
Title VI of the bill, which effectively codifies the Blockchain Regulatory Certainty Act, states that a non-controlling developer or provider of distributed ledger services shall not be considered a money-transmitting business.
This protection does not apply to developers who retain operational control over a network or protocol.
Section 602 further clarifies that the offer or sale of NFTs will not be treated as the offer or sale of a security unless all elements of an investment contract are met. NFTs may be used as collectibles, access credentials, or membership rights, and according to the Banking Committee, they do not become securities solely because their value may increase.

New Digital Assets Advisory Committee and Expanded Funding for FinCEN
The legislation also establishes a Joint Advisory Committee on Digital Assets, requiring federal agencies to formalize their cooperation through a Memorandum of Understanding.
In addition, the bill authorizes a significant increase in funding for FinCEN. From fiscal year 2026 through 2030, the agency would receive $30 million annually, along with authorization for recruitment incentives of up to 20% to attract qualified personnel.

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Finance Minister Muhammad Aurangzeb said on Tuesday that Pakistan was at an early but important stage in shaping its digital asset ecosystem.
He expressed the views during a meeting with a visiting delegation from Icoin Technology Inc, a Silicon Valley-based blockchain infrastructure company. The delegation was led by the company’s Chief Executive Officer Chet Silvestri, the finance ministry said in a press release.
According to the press release, the minister said Pakistan was at an early but important stage in shaping its digital asset ecosystem and welcomed knowledge-sharing and responsible investment aligned with national priorities.
During the meeting, Aurangzeb briefed the delegation on Pakistan’s ongoing efforts to develop a “structured and responsible” framework for digital assets and apprised it of the progress made toward the establishment of a Pakistan Crypto Council and the Pakistan Virtual Assets Regulatory Authority (PVARA)
“The minister highlighted Pakistan’s growing participation in global digital asset activity, as reflected in international analytics and emphasised the government’s resolve to channel this activity into a well-regulated environment that safeguards users while encouraging innovation and investment,” the statement said.
It further stated that the finance minister underscored that regulation was essential to balance opportunity with risk, particularly in light of increasing volumes of digital asset usage by Pakistani citizens.
The finance minister noted that the “evolving policy framework aims to provide clarity to market participants, align with international best practices and ensure coordination among regulators, including the central bank, to enable orderly market development and institutional participation”.
Meanwhile, Silvestri shared insights from the US and Canadian markets, drawing on Icoin Technology’s experience of working with banks, exchanges, and large-scale consumer platforms, the statement said.
He outlined how regulatory clarity in mature markets had enabled traditional financial institutions to engage with digital assets through existing infrastructure, rather than reinventing core banking systems.
According to the statement, he also explained the role of wallet-based middleware and switching technologies that allow banks to connect securely with exchanges, manage liquidity, enhance compliance, and offer digital asset services to customers through familiar banking applications.
“The delegation highlighted the transformational potential of blockchain technology and stable coins in modernising financial infrastructure by enabling faster, lower-cost and more transparent transactions, while maintaining regulatory oversight,” it said.
Reference was made to recent legislative developments in the United States aimed at bringing coherence to digital asset regulation, particularly in relation to stablecoins and the integration of digital assets within the banking system, it added.
The statement said the delegation emphasised that young and tech-savvy populations across markets were already engaging with digital assets and that regulated participation through banks helps retain activity within the formal financial system.
“The finance minister advised that, given the evolving nature of the regulatory landscape, initial engagement with interested banks and relevant institutions would be a constructive next step, alongside continued dialogue with regulators, including the State Bank of Pakistan,” it added.
Discussions also covered Icoin Technology’s global engagements, including partnerships enabling large consumer bases to access digital asset services, and the company’s interest in exploring opportunities in Pakistan in collaboration with local partners, the finance ministry said.
The delegation also sought guidance on appropriate regulatory pathways, licensing requirements and engagement mechanisms with relevant authorities, including banks and regulators, it added.
Both sides agreed to maintain engagement, explore areas of cooperation, and continue exchanges aimed at supporting Pakistan’s efforts to build a transparent, inclusive, and well-regulated digital asset market.
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