The crypto industry's leading figures recently signed a letter urging Senate leaders to preserve the BRCA (Blockchain Regulatory Certainty Act) within the Clarity Act. The BRCA establishes that software developers who do not take custody of user funds are not money transmitters under federal law. This provision survived committee markup despite a filed amendment to gut it, and must remain intact through final vote. The author argues that without this protection, developers will move offshore, as evidenced by the US share of open-source crypto developers falling from 38% in 2015 to roughly 19%. Cases like the Tornado Cash developer conviction highlight the risk of prosecuting builders who merely publish code. The BRCA does not legalize crime; it separates lawful builders from bad actors. The bill has bipartisan support from Sens. Lummis and Wyden, and Reps. Emmer and Torres. Keeping the BRCA intact is crucial to maintaining US leadership in crypto innovation.

Key facts

• Clarity Act with BRCA provision advanced through Senate Banking Committee with bipartisan support.
• BRCA protects developers who write open-source software or run nodes from being labeled money transmitters.
• US share of open-source crypto developers dropped from 38% in 2015 to 19% due to regulatory uncertainty.
• Tornado Cash developer conviction exemplifies risks pushing builders offshore.
• BRCA maintains anti-money-laundering rules for those holding customer funds.