Blockchain Association Rebuts Sheriffs’ Clarity Act Claims

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The Blockchain Association sent a letter to Senate Majority Leader John Thune and Minority Leader Chuck Schumer this week disputing the National Sheriffs’ Association‘s July 31 letter opposing the Digital Asset Market Clarity Act, arguing NSA “fundamentally misconstrues”.

what the bill does. But the rebuttal arrives at a moment when the underlying fight may not matter much for 2026: as of this week, no cloture motion has been filed and no floor vote is scheduled, with the Senate on track to leave for its August recess without taking up the bill at all.

That timing gap is the story here as much as the substance of the dispute. Whatever the merits of BA’s point-by-point response, it’s arguing a case that the Senate calendar may simply not get around to deciding this year.

What BA Says NSA Got Wrong About Section 10604 and DeFi

NSA’s letter claimed the Clarity Act exempts decentralized finance, mixers, bridges, developers, and user interfaces from anti-money-laundering and sanctions law broadly, and that it strips regulators of authority. BA’s response denies both claims directly, arguing the bill regulates based on what an intermediary actually does and what control it holds over customer funds and transactions, not, as BA characterizes NSA’s position, whether a person simply earns money somewhere in the transaction chain, however far removed from it.

On Section 10604, the Blockchain Regulatory Certainty Act provision at the center of the dispute, BA points to language limiting its protection to developers and providers who don’t control users’ funds. It notes the provision preserves 18 U.S.C. § 1960(b)(1)(C), the money-transmitting statute’s criminal-intent provision, along with money laundering, fraud, and sanctions law generally. That’s not a new claim from BA. NSA’s own May 13 letter to the Senate Banking Committee argued the opposite: that the same carve-out creates a”statutory carve-out”.

defendants could invoke against unlicensed-money-transmitting charges. The two sides are reading the same provision and reaching opposite conclusions about how courts would apply it in practice, and Section 10604’s wording has been amended more than once since that May letter.

BA disputes NSA’s characterization of Section 10301, the decentralized-finance provision, the same way: it frames the section as a directive for the SEC and Treasury to write rules for protocols that claim decentralization without actually having it, rather than a blanket exemption.

NSA’s Opposition Comes After Four Peer Groups Already Broke With It

BA’s rebuttal also argues NSA doesn’t speak for law enforcement as a whole. It names the Fraternal Order of Police, the National Organization of Black Law Enforcement Executives, the Major Cities Chiefs Association, and the Federal Law Enforcement Officers Association as bill supporters, and notes Major County Sheriffs of America dropped its opposition to a neutral stance in early July, a lineup BA cites specifically to argue there’s no law-enforcement consensus behind NSA’s position.

The sequence backs that point up. NOBLE endorsed the bill July 1, MCSA moved to neutral July 3, FLEOA backed it July 10, and FOP added support July 24 after reviewing a revised developer-protection provision. NSA’s July 31 letter came after all four of those shifts, not before them, which is the specific fact BA’s rebuttal leans on, not a broader claim about law enforcement’s overall posture toward the bill.

Where the Clock Actually Stands Before Recess

Procedurally, the bill has covered real ground: the House passed its version in July 2025, the Senate Banking Committee advanced it 15-9 in a bipartisan markup on May 14, 2026, and it was formally placed on the Senate’s legislative calendar on June 1. Since then, it has picked up a revised text on July 22 and a wave of law enforcement letters, for and against, without reaching the floor.

The next real checkpoint is the Senate’s ordinary cloture-filing deadline of Aug. 5, which could produce a floor vote on the motion to proceed as early as Aug. 7, the last realistic window before the chamber’s expected departure for recess around Aug. 10. That doesn’t kill the bill; floor action remains possible in the fall. But it does mean BA’s rebuttal, and NSA’s letter before it, are shaping a debate that Congress may not resolve until after the midterm election cycle disrupts the calendar further. Whether Thune can find the seven Democratic votes Republicans need is likely to turn on whether a cloture petition actually gets filed this week.

Timeline: How the Law Enforcement Fight Over Clarity Got Here

FAQ

1. What does NSA object to?
Primarily Section 10604, which NSA’s May 13 letter argues creates a carve-out that could shield non-controlling developers from money-transmitter liability in ways criminal defendants could exploit.

2. Does the bill exempt developers from money laundering or sanctions law? No, Section 60 addresses money-transmitter status specifically and preserves existing criminal statutes covering money laundering, fraud, and sanctions.

3. Will the Senate vote before recess? No cloture motion has been filed as of this week. The filing deadline for a pre-recess vote is Aug. 5, which could produce a floor vote as early as Aug. 7, before the Senate’s expected Aug. 10 departure.