The CLARITY Act (Clarity for Payment Stablecoins Act) advancing through the US Congress is quietly reshaping the crypto landscape. One of its core provisions requires tokens to either demonstrate sufficient decentralization or meet stringent disclosure and registration requirements—failing which, they would be classified as securities, subjecting issuers to rigorous SEC oversight.
Industry analysts estimate that more than 90% of tokens currently in circulation would struggle to meet CLARITY's compliance framework. Tokens that distribute protocol revenues—through dividends, buybacks, or fee-sharing schemes—are especially vulnerable, as regulators are likely to view them as investment contracts under the Howey Test. If deemed non-compliant, exchanges may delist them, and holders could lose legal recourse.
This raises a fundamental question for tokenomics: if a token cannot legally distribute protocol revenue, what exactly does it represent? A pure governance tool? Or a security-like claim? While named the Clarity Act, the proposed legislation injects deep uncertainty into the market. For project teams and investors alike, understanding and adapting to this regulatory shift is critical.
Legal experts advise projects to urgently redesign token mechanisms—weakening the link between revenue sharing and token value, moving toward fully decentralized governance, or proactively registering with the SEC. Failure to act could result in a wave of “zombie tokens” after the act takes effect, stripping liquidity and value from the vast majority of current crypto assets.