A coalition of 18 state attorneys general is sounding the alarm over the current draft of the CLARITY Act, warning it could strip states of key powers to police the crypto market and fight fraud. The group of 18 AGs has called on the Senate to make changes to the bill.

What state powers are at stake?

According to the AGs, if the CLARITY Act passes as written, states could lose some authority over licensing and supervising crypto firms. The bill could also let the SEC override individual state requirements for securities registration, shrinking local regulators’ toolkit.

Why this matters for the crypto market

The AGs argue that weakening state licensing and registration regimes would make it harder to catch bad actors at the local level and could leave consumers more exposed to crypto scams. They see real risks if regulatory power shifts away from the states.

What’s next: Senate vote set for September 15

The Senate is expected to vote on the CLARITY Act tomorrow, September 15. The AG coalition is pushing for key amendments before the vote to make sure states keep crucial oversight and enforcement tools in the crypto space.