Summer Mersinger, CEO of the Blockchain Association, emphasizes that consumers shouldn't have to endure another crisis for essential protections.
By Summer Mersinger|Edited by Cheyenne Ligon Jul 16, 2026, 3:07 p.m. 4 min readMake preferred on ShareShare this articleCopy linkX (Twitter)LinkedInFacebookEmailMake preferred onThe downfall of FTX nearly four years ago highlighted the absence of an effective regulatory framework to safeguard digital asset investors and consumers in the U.S. The Clarity Act aims to address this gap, yet more emphasis is needed on the protections it would afford customers.
After the FTX collapse, many consumers suffered due to inadequate or delayed protections. Numerous individuals were uncertain about the status of their assets—whether they were kept separate from the platform's funds or what the implications were if the company failed. As a result, regulators and bankruptcy courts were left to navigate the aftermath, with customers bearing the consequences.
The Clarity Act proposes to implement robust consumer protections proactively, establishing clear federal regulations for centralized platforms, brokers, dealers, and custodians involved in the trading and custody of digital assets. These regulations would encompass registration, oversight, disclosure, custody practices, asset segregation, market integrity, conflict of interest management, fraud prevention, and bankruptcy protocols.
Having served as a financial regulator, I recognize that while no legislation can entirely prevent market failures or eliminate fraudulent actors, strong regulations can significantly reduce adverse outcomes. They enhance regulatory oversight, impose responsibilities on companies prior to consumer engagement, and ensure firms operate with enforceable accountability. Although often described as legislation focused on crypto market structure, this characterization does not fully encompass its breadth. Market structure refers to the legal framework determining registration requirements, market oversight, obligations to customers, asset protection, necessary disclosures, and protocols for resolution when issues arise.
Currently, millions of Americans utilize digital asset exchanges, brokers, dealers, and custodians, opening accounts, executing trades, and entrusting intermediaries with their assets. If these businesses are to effectively serve American consumers, they must adhere to clear federal regulations.
The Clarity Act would mandate that digital asset intermediaries register, adhere to capital and risk management standards, maintain records, provide essential information to retail customers, monitor markets, resolve conflicts of interest, and comply with conduct regulations regarding fraud, manipulation, marketing, oversight, and fair pricing. These fundamental protections are standard in established financial markets and should be applicable in this context as well.
The legislation also addresses a critical concern regarding asset security in the event of platform failures: what happens to customer assets?
Customers should be informed about whether their assets held by an intermediary are segregated, the conditions under which the company may use them, and their treatment in cases of insolvency. Such information should be legally mandated and made clear upfront, rather than left to bankruptcy courts after customers have lost access to their assets.
Clarity would implement these protections before customers face bankruptcy proceedings, establishing requirements for customer asset protection among registered digital asset intermediaries, including custody standards, segregation protocols, restrictions on the misuse of customer property, and clearer guidelines for asset treatment during insolvency. This is a key takeaway from the FTX debacle: consumers suffer when rules surrounding customer property are ambiguous, conflicts of interest are unchecked, and regulators must piece together facts post-collapse.
The bill also enhances the information consumers receive prior to risking their funds. Digital asset markets can be complex and fast-paced, making it challenging for average users and investors to assess risks. Consumers should not need to possess extensive technical knowledge or legal expertise to understand the inherent risks of utilizing a platform or acquiring an asset. The Clarity Act mandates simple disclosures regarding technology, governance, trading activities, volatility, potential conflicts of interest, and other significant risks.
Additionally, the Clarity Act equips responsible firms and law enforcement with improved tools to combat fraud and other illicit activities. It imposes Bank Secrecy Act obligations on digital commodity exchanges, brokers, and dealers, and establishes a federal framework for digital asset kiosks, where consumers are particularly susceptible to scams. It also allows firms to pause suspicious transactions initiated in good faith, including those prompted by law enforcement requests.
It is important to clarify that the absence of the Clarity Act will not eliminate digital assets or halt market activities. Consumers will remain unprotected on the platforms they currently use, and regulators will continue to lack visibility into ongoing activities. The existing vulnerabilities that have previously harmed consumers will persist. Maintaining the status quo is not a viable solution.
While no legislation can ensure that future collapses are impossible, a comprehensive federal framework could significantly reduce the likelihood of such events by mandating federal oversight, custody standards, customer asset protections, simple disclosures, market integrity rules, fraud prevention measures, and retail education.
Members from both political parties have invested years in developing a sustainable framework for digital asset markets, recognizing the real stakes involved.
Consumers deserve not to wait for another crisis to obtain the protections they need.
Congress must approve the Clarity Act.
Note: The opinions expressed in this piece are those of the author and do not necessarily reflect the views of CoinDesk, Inc. or its affiliates.
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Gate Leads Spot Market Share Gains as CEX Volumes Rise for First Time in Five Months
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CEX trading volumes rose for the first time in five months in June, with spot climbing 15.3% to $1.11T and RWA perpetual volumes surging to a record $311B.
By CoinDesk ResearchJul 13, 2026CEX trading volumes rose for the first time in five months in June, with spot climbing 15.3% to $1.11T and RWA perpetual volumes surging to a record $311B.
Why it matters:
CEX trading volumes rose for the first time in five months in June, with spot climbing 15.3% to $1.11T and RWA perpetual volumes surging to a record $311B.
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