Clarity Act Provision Sparks Concern Over Crypto Developer Liability

The Alliance to End Human Trafficking is urging lawmakers to revisit Section 604 of the Clarity Act, citing concerns that it could weaken accountability in cases where crypto platform developers' technology facilitates human trafficking.

Katie Boller Gosewisch, executive director of the Alliance to End Human Trafficking, argued that language stating developers who do not control user funds are not money transmitters could allow some third-party platform developers 'to hide behind' a lack of liability.

Rettig countered by saying Section 604 reflects longstanding U.S. anti-money laundering policy and clarifies existing guidance on developers who do not control customer assets.