Key Takeaways
- U.S. Senator Ron Wyden urged Senate leaders to preserve protections for non-custodial blockchain developers in the CLARITY Act.
- Crypto policy advocates praised Wyden’s stance as a defense of software publication and open internet principles.
- Alex Thorn said backing developer protections does not necessarily indicate Wyden will support the broader CLARITY Act.
Why Is Wyden Pushing to Preserve Developer Protections?
U.S. Senator Ron Wyden (D-OR) sent a letter on July 8 to Senate Majority Leader John Thune (R-SD) and Senate Minority Leader Chuck Schumer (D-NY) urging them to retain Section 604 of the Digital Asset Market Clarity Act, in any version of the legislation brought to the Senate floor. The provision was approved by the Senate Banking, Housing, and Urban Affairs Committee.
Wyden wrote:
“I write to urge you to ensure that any version of the Digital Asset Market Clarity Act (Clarity Act) that is brought to the Senate floor preserves Section 604 of the bill as passed out of the Senate Banking, Housing, and Urban Affairs Committee.”
The lawmaker argued that developers who publish non-custodial software should not automatically fall under money transmitter regulations when they never take control of customer assets. “Developers who make and release software that allows people to manage their own digital assets – and, critically, where the developer does not control user assets – should not be treated as money transmitters solely because they create or publish software,” he explained.
Why Are Crypto Advocates Supporting the Letter?
The letter drew praise from several crypto policy advocates who view the provision as a safeguard for open-source software development. Peter Van Valkenburgh, executive director of Coin Center, stated on X:
“Senator Wyden has always been, and remains, one of the great champions of a free and open Internet. His unwavering support for the principle that developers should be free to publish software—even in the highly charged arena of crypto—is principled, deeply American, and correct.”
The DeFi Education Fund also thanked Wyden for his “continued advocacy for the BRCA,” highlighting industry support for retaining the developer protection language in the Senate bill.
Alex Thorn, managing director and head of firmwide research at Galaxy Digital, praised Wyden’s support for developers but cautioned that “pro-BRCA does not mean he will vote YES on CLARITY.” Thorn cited Wyden’s previous no votes on the DeFi CRA and GENIUS Act votes, suggesting his developer stance does not guarantee support for the broader bill.
Does Wyden’s Letter Signal Support for the Full CLARITY Act?
Wyden’s letter focuses specifically on preserving Section 604 while maintaining anti-money laundering and countering the financing of terrorism safeguards. He argued that developers involved in illicit activity would not be protected and said the provision would help direct enforcement resources toward criminals and unlicensed money transmitting businesses instead of neutral software developers.
The letter concludes with a direct appeal to Senate leadership as consideration of the legislation continues. The senator concluded:
“As the Senate continues its consideration of the Clarity Act, I urge you to include the Blockchain Regulatory Certainty Act in any legislative package.”
Whether Section 604 remains in the final Senate version of the CLARITY Act has yet to be determined. Wyden’s position on developer protections is explicit, but his vote on the broader legislation remains an open question based on the information currently available.
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