The post $25M Crypto Audit Rule Collapses as CLARITY Act Stalls appeared on BitcoinEthereumNews.com.
A proposed $25 million audit rule for crypto asset issuers did not become law. The CLARITY Act failed to advance in the Senate after a 50–49 vote. Crypto firms remain under existing rules as lawmakers debate new regulations. A proposed rule requiring crypto projects that raise more than $25 million from the public to disclose audited financial statements has become a major point of debate after the U.S. Senate failed to move forward with the Digital Asset Market CLARITY Act. Sen. Cynthia Lummis, a Republican from Wyoming and a key sponsor of the bill, said on September 20 that Democrats had asked for the audit requirement during negotiations but later voted against the bill. “Democrats voted against the transparency they asked for,” Lummis wrote. The requirement was included in the Senate’s final draft, released September 14, after lawmakers added more than 100 changes Democrats requested. Lummis and other Republican senators said those changes came from bipartisan negotiations. What the $25M Audit Rule Would Have Done The rule would not have applied to every cryptocurrency or token. It would have focused on certain token issuers whose tokens still depended on the company or people behind them. Issuers raising more than $25 million would have had to provide the SEC with audited financial statements. Issuers raising less than $25 million would have faced a lighter requirement: their financial statements would only need an independent review. The rules would also have required information about management, risks, legal issues, token supply, distribution, development plans, governance and related-party deals. The goal was to give investors more information about a project’s finances before investing large amounts of money. The proposal also created a way for some token issuers to raise money without following all the registration rules that apply to traditional public companies. Under the proposed…