Hoskinson Criticizes the CLARITY Act
Hoskinson warns the CLARITY Act could block new crypto projects, while banks see potential regulatory clarity.
Charles Hoskinson, co-founder of Cardano, has strongly criticized the proposed CLARITY Act, a bill intended to regulate the cryptocurrency market in the United States. During a live stream, he described the legislation as a “terrible bill” that could seriously harm the American crypto industry.
Hoskinson’s main concern focuses on how the bill defines new tokens. According to him, the proposal assumes that most newly issued cryptocurrencies would automatically be treated as securities. This would place them under the supervision of the U.S. Securities and Exchange Commission (SEC).
He argues that such an approach could create a regulatory deadlock for new projects. Crypto developers would be forced to meet extremely demanding legal requirements that, in practice, might make it nearly impossible to launch and grow new initiatives. In his view, the rules could effectively be used to block projects before they even begin.
The Cardano co-founder also warned that technology companies might move their operations outside the United States. This, he said, could limit innovation and weaken the country’s competitiveness. He added that large, well-established projects such as Cardano or XRP would likely be able to adapt to the new regulations, while newer ventures would face the biggest challenges.
The CLARITY Act proposes dividing oversight of cryptocurrencies between the SEC and the Commodity Futures Trading Commission (CFTC). If a token is considered sufficiently decentralized, it would be treated as a digital commodity and fall under the authority of the CFTC. Otherwise, it would remain under SEC supervision.
Not everyone shares Hoskinson’s concerns. Some banks and industry representatives believe the bill could bring much-needed legal clarity to the crypto market. Analysts at JPMorgan say that if the regulations are adopted by mid-2026, they could attract greater institutional investment into cryptocurrencies.
Under the proposal, new projects would also be allowed to raise up to $75 million per year without requiring full SEC approval. According to JPMorgan, this could encourage venture capital funds to once again invest in crypto projects based in the United States.
Support for the bill has also been signaled by well-known figures in the industry, including Ripple CEO Brad Garlinghouse and Coinbase CEO Brian Armstrong. Some market observers predict that the proposal could pass through Congress as early as this spring.
