Senators Introduce Blockchain Regulatory Certainty Act

TLDR

• The act exempts non-custodial developers from money transmitter laws.
• It seeks to prevent developers from being classified as banks.
• The bill has strong support from key crypto advocacy groups.

Senators Cynthia Lummis (R-WY) and Ron Wyden (D-OR) introduced the bipartisan Blockchain Regulatory Certainty Act on January 12, 2026. The act aims to exempt non-custodial blockchain developers from money transmitter laws. This legislation protects developers who do not control user funds. It reflects previous attempts for safe harbors, like H.R.3533.

The act’s introduction seeks to address concerns for developers like those involved in Tornado Cash cases. Senators aim to prevent classification of developers as banks or transmitters, arguing such designation is impractical. The bill has been endorsed by key groups in the crypto community, including the Blockchain Association and Paradigm.

Senator Statements Highlight Privacy and Innovation Concerns

Senator Lummis has historically pushed for pro-innovation policies, stating, “Blockchain developers who have simply written code and maintain open-source infrastructure have lived under threat of being classified as money transmitters for far too long.” This stance emphasizes the illogical association between code writing and money handling.

Senator Wyden echoed these thoughts, declaring, “Forcing developers who write code to follow the same rules as exchanges or brokers is technologically illiterate.” Both senators focus on protecting developers’ rights and fostering a safe environment for crypto innovation. This aligns with Wyden’s ongoing advocacy for privacy in tech policy.

Community and Industry Support for the Legislation

Crypto advocacy groups have responded positively to the proposed legislation. The DeFi Education Fund endorsed the bill via social media, highlighting the protection it offers developers. Supporters view it as a necessary step for fostering innovation in cryptocurrency and blockchain technologies.

Paradigm, via VP of Government Affairs Alexander Grieve, called the bill “crucial legislation” for U.S. blockchain developers. The legislation has also been supported by entities like the Blockchain Association, which stresses its importance for continuing U.S. innovation in the field.

Context From Past Legal Challenges

The need for clarity arises from past legal challenges, such as the Tornado Cash co-founder’s conviction. Developers in similar situations have faced charges for unlicensed money transmission. These precedents created uncertainty about developers’ legal classification and drove some talents offshore. The newly proposed act seeks to reverse this trend.

While the direct financial implications of the bill are unspecified, its regulatory safe harbors are central. No current data on market liquidity shifts or asset impacts is available. The act focuses on non-custodial developers associated with prominent protocols like Ethereum and Bitcoin.

For more information on the proposed House Bill 3533, you can access the full text at Text of House Bill 3533 from the 119th Congress.