Protect Developers or Weaken Oversight? Judiciary Committee Strongly Opposes Section 604 of the CLARITY Act

**January 17** Senate Judiciary Committee Republican Chair Chuck Grassley and top Democrat Dick Durbin are urging the Senate Banking Committee to exclude the "Blockchain Regulatory Certainty Act" from cryptocurrency market structure legislation, arguing its provisions would weaken federal fund transfer rules. In a letter, the pair flagged Section 604 of the Banking Committee’s market structure bill—intended to shield software developers from criminal liability for third-party misuse of their products—as a threat to federal unlicensed money transmission laws. Notably, the Judiciary Committee (which oversees Title 18 of the U.S. Code) was neither consulted nor given advance substantive review of the proposed changes. The letter cites the Justice Department’s prosecution of Tornado Cash developer Roman Storm, noting the case underscores that existing regulations already enable holding parties accountable for unlicensed money transmission. The latest pushback complicates the Banking Committee’s bill: it canceled a Thursday debate and vote (scheduled amid growing opposition) on Wednesday night. If Section 604 remains, the Judiciary Committee would need to sign off as a third committee on the package—further snarling the legislative process. DeFi advocates warn they will withdraw support without the developer protection provision, signaling another potential deadlock. The letter concludes: "We urge the committee to reject any provisions that weaken the government’s ability to hold parties accountable for unlicensed money transmission, including Section 604."