August 8, 2025
On July 17, 2025, the United States House of Representatives passed the Clarity Act,1 which seeks to implement a national registration and reporting regulatory scheme for the crypto and related markets. The United States Senate issued a discussion draft with similar aims on July 22, 2025.2 The Utah Division of Securities (“Division”) applauds Congress in taking the first long overdue steps needed to bring stability and transparency to the crypto markets. Both the House’s Clarity Act and the Senate’s discussion draft have provisions necessary to protect investors nationwide, including making necessary disclosures for the public to review and consider when making crypto-based investment decisions.
Any federal legislation pertaining to investment products, including cryptocurrency, should preserve the federal government and state securities administrators’ joint roles in combatting financial fraud. Currently, there is an epidemic nationwide with crypto frauds costing Americans billions of dollars. Citizens are losing, in some instances, their life savings simply by trying to do more to ensure their own and their family’s financial well-being.
State securities administrators nationwide are, in large part, the frontline defense against the crypto scourge. The states and federal regulators often partner on complex, high-profile cases. But the states, and Utah in particular, tackle frauds of all sizes, providing in some instances the only possible means to bring to bear financial fraudsters. The Division dedicates significant time and resources addressing complaints from Utahns who have lost thousands of dollars to scams like pig butchering – investment fraud that federal agencies, with their heavy caseloads, may not have the capacity to handle. Indeed, over 50% of the enforcement complaints the Division currently receives are crypto-related scams.
Therefore, the Division, along with state securities administrators across the country, sent a letter to the Chairpersons and Ranking Members of the House Committees on Financial Services and Agriculture – the two committees responsible for overseeing the securities and commodities industries, respectively – encouraging Congress to take affirmative steps in ensuring that any congressional legislation regulating the crypto markets preserves the states’ securities administrators’ authority to enforce the anti-fraud provisions of their securities acts remain with full force. “If market structure legislation is passed without preserving state anti-fraud enforcement authority,” the letter explained, “we are concerned that many crypto frauds will go unaddressed.”
The Division strives to ensure that bad actors in the investing markets are held accountable, a mission that is best achieved when states can work alongside their federal counterparts. Congress’ proposed legislation is the first step towards sensible regulation in the crypto markets, and the Division looks forward to focusing on investigating and prosecuting securities fraud throughout the state, working to stem the devastating tide of fraud being wrought on Utahns through crypto scams.
You can read the letter here
- The Digital Asset Market Clarity Act (CLARITY Act; H.R. 3633), available at https://www.congress.gov/bill/119th-congress/house-bill/3633 ↩︎
- The Responsible Financial Innovation Act of 2025, available at https://www.banking.senate.gov/imo/media/doc/senate_banking_committee_digital_asset_market_structure_legislation_discussion_draft.pdf ↩︎
