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Senator Cynthia Lummis has pushed back against Senator Elizabeth Warren’s criticism of the Digital Asset Market CLARITY Act, arguing that the legislation strengthens Anti-Money Laundering (AML) protections rather than creating new loopholes. The exchange comes as the Senate weighs landmark crypto market legislation, while lawmakers remain divided over whether the bill does enough to combat money laundering and sanctions evasion.
Warren cited recent reports alleging that America’s adversaries have used cryptocurrency to move billions of dollars, arguing Congress should strengthen existing safeguards instead of passing legislation that, in her view, creates new loopholes.
More evidence that our adversaries exploit crypto to move billions.
The Clarity Act, as it's currently written, would make this problem worse.
Congress should be strengthening illicit finance standards, not creating new loopholes. pic.twitter.com/61lqFgRntH
— Elizabeth Warren (@SenWarren) June 28, 2026
In a post on X, Lummis said the CLARITY Act contains more than 16 safeguards against illicit finance and rejected claims that the legislation weakens enforcement.
The Clarity Act has 16+ illicit finance safeguards, not loopholes:
✅ Sec 201: BSA/AML applies to crypto
✅ Sec 303: new sanctions to hit Iran
✅ Sec 305: exchanges can freeze dirty moneyIf you don’t like crypto, then say it, but stop these baseless attacks. https://t.co/JZVhjC9Efn
— Senator Cynthia Lummis (@SenLummis) July 1, 2026
She highlighted Section 201, which applies Bank Secrecy Act and AML requirements to covered crypto businesses. She also cited Section 303, which expands sanctions tools targeting actors such as Iran, and Section 305, which allows exchanges to freeze suspected illicit funds, while authorities pursue legal action.
Lummis said critics should be upfront if they oppose digital assets instead of claiming the legislation creates illicit finance loopholes.
The disagreement reflects one of the central issues surrounding the CLARITY Act as it moves through Congress. Supporters say the proposal gives regulators and law enforcement additional tools while establishing clearer rules for the digital asset industry. Critics, including Warren, argue that parts of the bill should go further to prevent money laundering, sanctions evasion, and abuse of decentralized financial services.
Opposition has also come from outside Congress. On June 23, a coalition of law enforcement groups and a Catholic anti-trafficking organization urged lawmakers to revise Section 604, arguing that the developer safe harbor could reduce oversight by exempting some blockchain software developers from certain AML obligations.
🚨NEW: In a letter to administration officials, a group of four law enforcement organizations say they remain concerned about certain provisions in the Clarity Act, including Section 604 (the Blockchain Regulatory Certainty Act), arguing it would create gaps in oversight and… pic.twitter.com/y8FQ0HKjp0
— Eleanor Terrett (@EleanorTerrett) June 23, 2026
The political path remains challenging. The Senate returns from recess later this month, leaving limited time before the August break to advance major legislation. The measure would also require bipartisan support to overcome procedural hurdles.
Prediction markets have reflected that uncertainty. Data from Polymarket shows the estimated probability of the CLARITY Act becoming law in 2026 has fallen from about 64% in early June to roughly 40%, reflecting lower confidence that the legislation will become law in 2026.
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