The DeFi developer protection clause in the US crypto bill has faced opposition.

Law Enforcement Groups Push Back on DeFi Provision in Senate Crypto Bill

A coalition of law enforcement groups is pushing back on a key provision in the Senate's crypto market structure bill. The measure would shield DeFi software developers from being classified as money transmitters. In recent letters to lawmakers, the Sheriffs' Association, District Attorneys' Association, and other groups argued the clause would weaken their ability to combat financial crime.

Senate Banking Committee Chairman Tim Scott and Senator Cynthia Lummis are standing firm, insisting the provision cannot be changed. The crypto industry has also made clear it won't accept substantial edits to the language. On the other side, Democratic Senator and Judiciary Committee Chairman Chuck Grassley and others are calling for tweaks to the wording. With Congress on break, it's still unclear whether the bill can muster bipartisan support to move forward in committee.