- House Democrats claim the SEC withheld written technical analysis of the CLARITY Act from them while giving it to Republicans, calling a recent agency briefing evasive and partisan.
- Staffers say the SEC failed to answer basic questions and sent non-experts to the call, marking a break from standard bipartisan briefings.
- Democrats fear the bill’s exemptions could weaken oversight beyond crypto, and Maxine Waters is demanding a formal SEC analysis before the June 5 committee hearing.
House Democrats are accusing the Securities and Exchange Commission (SEC) of partisan interference after the agency allegedly refused to provide them with written technical analysis of the CLARITY Act, a crypto market structure bill that could overhaul crypto regulation in the US, while sharing the same documents with Republican staffers.
According to aides who spoke Tuesday, a recent technical assistance call with SEC officials was “the worst” they’ve ever seen, citing evasive answers, irrelevant personnel, and clear disparities in access to information.
The staffers said the SEC failed to answer basic questions during the call, while simultaneously claiming some responses were “privileged”, even as they allegedly shared those same details with Republican counterparts on the House Financial Services Committee.
Rather than being briefed by agency subject-matter experts, Democrats were met with staffers from the SEC’s legislative affairs office, legal counsel, and the newly formed Crypto Task Force —an arrangement they described as a serious departure from protocol.
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The briefing was held last week ahead of the committee’s June 5 hearing on the CLARITY Act. While Republicans reportedly received formal written technical assistance from the SEC, Democratic aides said they were given nothing of the sort.
The Response
In response to the agency’s stonewalling, Committee Ranking Member Maxine Waters is preparing a letter to SEC Chair Paul Atkins, requesting a formal written analysis of the bill’s implications, similar to the report provided by former Chair Gary Gensler in 2023 when the FIT21 bill was under consideration.
A draft of the letter reviewed by Decrypt reads:
Given the significant implications this bill would have on the regulatory landscape for digital assets, investor protection, capital formation, market competition, and the SEC’s ongoing regulatory efforts, a current and thorough analysis from the Commission is needed for informed policymaking.
Letter to the SEC
According to the outlet, Democratic staffers are especially worried that the bill may be pushing the SEC from doing any oversight on crypto. This means the legislation could offer traditional finance firms a regulatory escape hatch, just as long as they slap a blockchain label on their products, of course.
Related: Justice Minister Quits After US$45M Bitcoin Scandal Rocks Czech Republic
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