Deconstructing the Power, Interests, and Betrayal Behind the CLARITY Act: How Can Retail Investors Hedge Risks and Seize Opportunities?

marsbitPublicado a 2026-01-18Actualizado a 2026-01-18

Resumen

The CLARITY Act, a pivotal U.S. crypto regulatory bill aimed at ending years of regulatory uncertainty, has become a battleground between traditional finance and the crypto industry. Initially supported by major firms like Coinbase, Ripple, and Kraken, the bill sought to clarify jurisdiction—with the CFTC overseeing decentralized assets like Bitcoin and the SEC handling asset-like tokens. However, a Senate revision in early 2026 introduced harsh条款, including de facto bans on tokenized stocks, restrictions on RWA (Real World Assets), and stringent DeFi regulations requiring bank-like registration. Coinbase CEO Brian Armstrong publicly withdrew support, citing the elimination of stablecoin yield rewards (a key revenue stream), stifling of tokenization innovation, and unworkable DeFi rules. The bill’s impact is mixed: it offers散户 investor protections like mandatory custody of exchange funds but may cost them 3-5% yield on stablecoins. Institutions gain clarity for entering the market, while project teams face strict分类—easing compliance for “digital goods” but burdening “securities.” Key industry figures are divided: some urge pushing the bill through to avoid missing the legislative window, while others, like Coinbase, fear worse outcomes if flawed terms are locked in. For散户, the advice is to rebalance toward “digital commodity” assets (e.g., BTC, ETH), explore DeFi for yield if CEX rewards vanish, and avoid RWA investments due to potential liquidity risks. The act represent...

Authors: Changan, Teddy, Amelia, Denise I Biteye Content Team

In early 2026, after five years of regulatory tug-of-war and hundreds of enforcement cases, the eyes of the global cryptocurrency market were fixed on Capitol Hill in Washington. This bill, named CLARITY, was originally intended to provide clarity for digital assets that had long been in a regulatory gray area, but at the last moment, it turned into an ultimate showdown between the old and new financial orders.

Today, we open this hundreds-page bill, not to parse legal jargon, but to explore: Why did Coinbase, which once led the charge in embracing regulation, "angrily turn against it" at the last minute? As a retail investor, how will these hundreds of pages change your wallet?

Background: The End of the Law of the Jungle

Before the birth of the CLARITY Act, crypto regulation in the U.S. was like a lawless land, with major players struggling in chaos:

  • Civil War of the Dual Hegemony: Before CLARITY, the U.S. lacked a unified framework for crypto assets. The SEC (Securities and Exchange Commission) wanted to regulate tokens as stocks, the CFTC (Commodity Futures Trading Commission) wanted to regulate them as commodities. Projects caught in the middle never knew which one would come knocking tomorrow.
  • The Fear of "Regulation by Litigation": Due to the lack of clear law, the SEC chose a simple and brutal path: "sue first, set rules later." Ripple and Coinbase were both deeply affected. Taking the Ripple case as an example, this lawsuit lasted over 3 years, directly impacting XRP's market capitalization fluctuations worth tens of billions of dollars, and became a psychological shadow for the entire industry. This directly led to a significant brain and capital drain to places like Singapore and Europe.
  • Traditional Banks' Anxiety: Stablecoins offer an average annualized yield of 4.2%, far higher than traditional bank deposit rates, raising concerns over a potential monthly deposit outflow of over $20 billion. To protect their "money bags," banking lobbying groups urgently needed a set of laws to put a leash on cryptocurrency.

To end the chaos, this hundreds-page Clarity bill attempted to redefine market rules by:

1) Clarifying the regulatory body: Assets that are sufficiently decentralized and no longer rely on a single issuer (like Bitcoin) are regulated by the CFTC. Assets in early stages with obvious financing attributes are regulated by the SEC.

2) Integrating a stablecoin framework: Excluding "licensed payment stablecoins" compliant with the GENIUS Act from the securities definition, with their trading usage supervised by the CFTC/SEC, and issuance and reserve requirements referencing the GENIUS Act.

Ending regulatory infighting and giving the market a "predictable future." This is why companies like Coinbase, Ripple, and Kraken initially publicly supported CLARITY.

Until the Senate version appeared.

Baldy's "Last-Minute Betrayal"

The original version of the CLARITY bill was intended to be clear, attempting to redefine rules through three pillars: asset classification, financing regulation, and stablecoin access. However, in the Senate revised version in January 2026, the wind shifted suddenly, and the clauses became extremely harsh:

  1. Tokenization Ban: The Senate draft added clauses that essentially restrict the tokenized trading of traditional financial assets (like U.S. stocks, bonds) directly on public blockchains.

  2. RWA Exclusion: The bill explicitly excludes RWA (Real World Assets) from the definition of digital commodities, meaning they will be subject to extremely strict and inflexible securities law regulation, potentially even barring them from listing on CEXs.

This amendment triggered intense discussion within the industry. Coinbase CEO Brian publicly withdrew support for the bill,直言 (stating plainly) that the amended bill was worse than having no bill at all. The core objections were mainly three:

1. Strangling Stablecoin Rewards (The most direct conflict of interest)

Coinbase partners with Circle, allowing users holding USDC to earn about 3.5% rewards. This contributes significant revenue to Coinbase. Banking lobbies pushed hard for this clause because they fear depositors will move funds from banks into interest-bearing stablecoins.

2. The Ban on Stock Tokenization and RWA

Coinbase has always been bullish on Tokenization, seeing it as the future of finance. The new bill, through complex registration requirements, effectively bans the free trading of tokenized stocks on crypto infrastructure.

3. The End of DeFi

The bill requires almost all DeFi protocols to register like banks or brokers, granting the government high levels of access to DeFi transaction data. Brian Armstrong believes this violates user privacy and is technically infeasible.

How Will the Bill Affect Us?

The same bill presents drastically different scripts for different market participants.

1. Retail Investors: A Double-Edged Sword

Benefit: The bill mandates that CEXs must segregate customer funds, held by third-party custodians, preventing FTX-style tragedies at their root.

Drawback: Due to the 2026 amendment's protection of banks, retail investors may lose the 3%~5% interest on CEX-held stablecoins. Furthermore, the vision of ordinary people buying fractional shares (e.g., 0.01 shares of Tesla) on-chain will likely vanish into thin air due to RWA restrictions. Of course, this depends on whether the asset and CEX's region fall under the bill's jurisdiction.

2. Institutions: The Compliance Dividend

For institutions, this is more like a long-awaited compliance ticket. Legal certainty is a prerequisite for giants like Goldman Sachs and BlackRock to enter the market.

Once the jurisdictional boundaries between the SEC and CFTC are clarified, tens of billions of dollars in institutional funds will be allocated compliantly to digital commodities beyond Bitcoin and Ethereum, inevitably triggering a wave of applications for altcoin spot ETFs.

3. Project Teams: Mixed Fortunes

Projects defined as digital commodities will escape the clutches of the SEC; those defined as securities will face extremely heavy compliance reporting obligations and financing restrictions.

Additionally, the bill mandates lock-up periods for core team tokens, effectively curbing the恶习 (bad habit) of dumping at launch.

Fortunately, the bill explicitly protects non-custodial developers. If you merely write code and release open-source protocols without handling customer funds, you will not be considered a Money Transmitter. This protects pure technological innovation at the protocol level.

The Great Industry Debate: Consensus or Division?

Biteye has compiled the stances of industry KOLs & project teams regarding the latest revised bill.

AB Kuai.Dong @_FORAB (XHunt Rank: 1087)

Tweet Link: https://x.com/_FORAB/status/2011710073933095037

Viewpoint: Reports on Coinbase's sudden reversal, believing the latest version of the bill is friendly to traditional banks but unfavorable to crypto-native companies. Specific objections include restrictions on stablecoin rewards, increased costs for stock tokenization, and expanded government oversight of DeFi, potentially stifling innovation.

qinbafrank @qinbafrank (XXHunt Rank: 1533)

Tweet Link: https://x.com/qinbafrank/status/2011631328555647098

Viewpoint: Points out that the Senate Banking Committee canceled deliberations due to Coinbase's opposition, potentially causing a market correction. Opposition focuses include the "de facto ban" on tokenized equity, DeFi privacy invasion, weakening CFTC power, and eliminating the stablecoin reward mechanism, believing this will let the SEC dominate and suppress innovation.

Phyrex @Phyrex_Ni (XXHunt Rank: 765)

Tweet Link: https://x.com/Phyrex_Ni/status/2011810871211925967

Viewpoint: Analyzes the reasons behind Coinbase CEO's obstruction of the bill, including restrictions on tokenized stocks, functional regulation of DeFi, issues with SEC power boundaries, prohibition of interest-bearing stablecoins, and ethical conflicts of interest related to the Trump family.

PANews @PANews (XXHunt Rank: 1827)

Tweet Link: https://x.com/PANews/status/2011013801802686752

Viewpoint: Believes further delays will make the situation increasingly unfavorable. January is one of the few structural legislative windows available to the Senate. If it fails to make substantive progress, it can easily be "naturally squeezed out" by the overall legislative schedule. Also, if Democrats gain an advantage in the midterm elections, the probability of passage will be even lower.

Jason Chen @jason_chen998 (XXHunt Rank: 1082)

Tweet Link: https://x.com/jason_chen998/status/2012358494901694931

Viewpoint: Believes the conflict is essentially driven by the interests of various parties. For example, Coinbase publicly opposes it because the current version's ban on paying interest on stablecoins would directly cause Coinbase to lose $1 billion in annual revenue and significant user churn. Conversely, Ripple's CEO strongly supports the advancement of the CLARITY Act, also because the ban on stablecoin interest has little impact on Ripple.

Bitcoin Orange @chengzi_95330 (XXHunt Rank: 3508)

Tweet Link: https://x.com/chengzi_95330/status/2012136666912494037

Viewpoint: Points out that although the current bill is imperfect, a16z, Circle, Kraken, etc., are willing to continue pushing forward because they fear that if they walk away from the table now, the legislative window might shut completely. Coinbase, however, believes that if core issues like stablecoin yields cannot be included under the current crypto-friendly political climate, there will be absolutely no chance in a future, more anti-crypto political cycle. Thus, they are making a "historical judgment bet."

Brad Garlinghouse (Ripple CEO) @bgarlinghouse (XXHunt Rank: 1870)

Tweet Link: https://x.com/bgarlinghouse/status/2011559973818343785

Viewpoint: Expressed surprise at Coinbase's strong opposition, acknowledging Brian's concerns are reasonable but emphasizing that "the rest of the industry is still constructively supporting and working to solve problems." Garlinghouse stated Ripple is ready to advance under a compliance framework (e.g., XRPL tokenization), sees the bill as a step forward, and is unwilling to abandon the overall process due to disagreements.

Vlad Tenev (Robinhood CEO) @vladtenev (XXHunt Rank: 380)

Tweet Link: https://x.com/vladtenev/status/2011622052457783432

Viewpoint: Supports advancement. He reiterated Robinhood's support for Congress passing a market structure bill, acknowledged more work is needed (e.g., resolving staking restrictions in some states and stock tokenization availability), but sees a clear path and is willing to assist the Senate Banking Committee in completion. Emphasized the U.S. needs to lead crypto policy to unlock innovation and protect consumers.

Arjun Sethi (Kraken co-CEO) @arjunsethi (XXHunt Rank: 1941)

Tweet Link: https://x.com/arjunsethi/status/2011579807272759639

Strongly supports. He stated Kraken is fully committed to supporting the efforts of Tim Scott and Cynthia Lummis, criticized that "walking away easily or declaring failure is easy," but what truly matters is "continuing to show up, solve problems, and build consensus." Warned that giving up would exacerbate uncertainty and drive innovation overseas.

Retail Investor Risk Hedging and Opportunity Seizing: 2026 Action Guide

A rite of passage, a new beginning. Looking at the entire博弈 (game/contest) of the CLARITY Act, this is actually a "rite of passage" for the crypto industry. It marks cryptocurrency's formal leap from the fringe to the main stage of global finance.

Regulatory "clarity" itself is the most significant infrastructure. For retail investors, understanding and adapting to these new rules is key to protecting and growing assets in the coming years. Below are three practical, actionable plans we've outlined for you.

1. Re-evaluate Your Portfolio, Lean Towards "Digital Commodity" Assets

For crypto asset holdings, consider increasing the allocation weight of assets clearly classified as "digital commodities" (like Bitcoin, Ethereum, etc.) and mature blue-chip tokens within their ecosystems. Such assets will be the first to see large-scale compliant capital inflows from traditional institutions due to the elimination of regulatory uncertainty. Their spot ETFs and other products are also easier to approve, forming strong price support. Conversely, be extremely cautious with newly issued tokens that are likely to be classified as "securities." They will face harsh disclosure and financing restrictions, and their liquidity may dry up.

2. Reconfigure Stablecoin Strategy, Seek Alternative Yield Solutions

If you are in a region under Clarity's jurisdiction (e.g., the U.S.), since the bill may restrict CEXs (like Coinbase, Circle) from offering 3%~5% stablecoin rewards, consider moving funds to non-custodial on-chain DeFi protocols if the bill officially takes effect and causes compliant exchange interest to drop to zero. Although the bill strengthens regulation on DeFi, as long as the protocol itself is censorship-resistant, its native yield could become a safe haven.

3. Be Cautious with the RWA Sector, Beware of Liquidity Traps

Given the Senate revision's extremely harsh stance on RWA (Real World Assets), potentially even banning their listing on CEXs, if you currently hold a significant amount of tokenized U.S. stocks or bonds, be wary of liquidity drying up. Also, before the bill is finalized, do not blindly participate in tokenized traditional financial products that require high compliance and Know Your Customer (KYC) verification, as these products are most susceptible to being forced to shut down due to policy changes.

Preguntas relacionadas

QWhat is the main purpose of the CLARITY Act as originally intended, and why did major crypto companies initially support it?

AThe CLARITY Act was originally intended to provide regulatory clarity for digital assets by ending the regulatory tug-of-war between the SEC and CFTC. It aimed to clearly define which assets are classified as securities (regulated by the SEC) and which are digital commodities (regulated by the CFTC), establish a framework for stablecoins, and provide a predictable regulatory environment. Major companies like Coinbase, Ripple, and Kraken initially supported it because it promised to end the 'regulation by enforcement' approach and provide legal certainty for the industry.

QWhy did Coinbase CEO Brian Armstrong publicly withdraw support for the CLARITY Act after the January 2026 Senate revisions?

ACoinbase's CEO withdrew support because the Senate's revised version of the bill introduced extremely stringent clauses that were detrimental to the crypto-native industry. Key reasons included: 1) It effectively banned interest-bearing stablecoin rewards, which are a major revenue source for Coinbase. 2) It placed heavy restrictions on the tokenization of traditional assets like stocks (RWA) and made it nearly impossible to trade them on centralized exchanges. 3) It imposed bank-like registration requirements on DeFi protocols, which was seen as a violation of user privacy and technically unfeasible.

QHow does the CLARITY Act, particularly its Senate revision, impact retail investors according to the article?

AFor retail investors, the act is a double-edged sword. A positive impact is that it mandates centralized exchanges (CEXs) to segregate and third-party custody customer funds, preventing another FTX-style collapse. Negative impacts from the Senate revision include: the potential loss of 3-5% interest earned on stablecoins held on CEXs (due to banking lobby pressure), and the crushing of the vision for ordinary people to purchase fractionalized shares (like 0.01 Tesla stock) on-chain, as RWA tokenization faces severe restrictions.

QWhat is the article's recommended action for散户 (retail investors) regarding their stablecoin strategy in response to the CLARITY Act?

AThe article recommends that retail investors in jurisdictions governed by the CLARITY Act (like the U.S.) should reconfigure their stablecoin strategy to find alternative yield sources. If the bill passes and eliminates interest on compliant exchanges, investors should consider moving their funds to non-custodial, on-chain DeFi protocols. While DeFi also faces increased scrutiny, its native yields could become a haven if the protocols themselves remain censorship-resistant.

QAccording to the industry debate summarized by Biteye, what was a key strategic difference in opinion between Coinbase and companies like Ripple and Kraken?

AThe key strategic difference was about whether to support the flawed bill or reject it entirely. Companies like Ripple and Kraken, along with a16z and Circle, advocated for continuing to support and work constructively on the bill, fearing that if they 'walked away,' the current legislative window would close entirely, leading to prolonged uncertainty. Conversely, Coinbase made a 'historical bet' that if core issues like stablecoin yields couldn't be secured in the current crypto-friendly political climate, they would have no chance in a future anti-crypto cycle, making the current bill worse than having no bill at all.

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