The head of the Solana Institute, Kristin Smith, is calling on U.S. senators to maintain legal protections for blockchain developers within the CLARITY Act. With over 200 crypto firms and more than 60 industry leaders supporting the bill, Smith argues that open-source developers, validators, and non-custodial wallet providers should not be classified as financial intermediaries. She emphasizes that these parties do not control user funds or execute transactions, making it essential to exempt them from broker-like regulations.
Smith referenced the Blockchain Regulatory Certainty Act, introduced by Senators Cynthia Lummis and Ron Wyden, as a model for how to treat non-custodial developers. This proposal would prevent software publishers and network maintainers from being labeled money transmitters solely due to their coding activities. She insists that similar exemptions must be preserved in the CLARITY Act during ongoing Senate negotiations.
Industry pressure is mounting as the legislative window shrinks. Galaxy Digital analyst Alex Thorn downgraded the bill’s passage odds from 75% to 60%, citing the upcoming August recess and midterm election distractions. JPMorgan also warned that disputes over stablecoin yields and political deadlines could block progress. Meanwhile, SEC Commissioner Hester Peirce has voiced support for developer protections, stating that publishing open-source code is a First Amendment activity and should not automatically trigger financial regulation.