U.S. Representatives Propose CLARITY Act to Safeguard National Security
In a bipartisan move, U.S. Representatives Zach Nunn and Abigail Spanberger have put forward the Creating Legal Accountability for Rogue Innovators and Technology Act of 2023, also known as the CLARITY Act. This bill aims to address the issue of engagement between U.S. federal officials and Chinese blockchain entities by prohibiting federal government employees from using Chinese blockchain networks and transacting with certain Chinese companies, including iFinex—the parent company of Tether, a prominent cryptocurrency stablecoin issuer.
The proposed legislation also extends to interactions with the Spartan Network, the Conflux Network, and Red Date Technology, emphasizing its comprehensive scope. The primary motivation behind the act is to protect national security interests by preventing potential adversaries from accessing sensitive U.S. intelligence and private data.
Tether’s Financial Entanglements with Chinese Firms Spark Legislation
The introduction of the CLARITY Act comes in response to revelations about Tether’s financial connections with Chinese companies. Reports have revealed that Tether’s reserves included securities from state-owned Chinese enterprises and substantial loans to Chinese companies, raising concerns about the assets backing its stablecoin. The Securities and Exchange Commission (SEC) has also been scrutinizing Tether’s activities, particularly allegations of providing loans in its USDT stablecoin despite previous assurances to the contrary.
Hot Take: CLARITY Act Reflects Stricter Stance on Crypto Security
The introduction of the CLARITY Act signals a tougher approach to the intersection of cryptocurrency and national security, demonstrating increased scrutiny over the influence of Chinese companies in the crypto sector.
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