Solana Policy Institute CEO Urges Senate to Keep Open-Source Developer Shields in CLARITY Act

The Solana Policy Institute's CEO Kristin Smith is calling on the US Senate to pass the Digital Asset Market Clarity Act with its open-source developer protections intact. If those provisions are stripped or weakened, blockchain software contributors could face federal money-transmission prosecution for writing code they don't control.

The Digital Asset Market Clarity Act, commonly called the CLARITY Act, cleared the Senate Banking Committee on May 14 in a 15-9 bipartisan vote, with Democratic Senators Ruben Gallego of Arizona and Angela Alsobrooks of Maryland crossing party lines to join all Republicans on the panel. The bill now sits on the Senate legislative calendar ahead of an expected summer floor vote, though it still needs 60 votes to advance, must be reconciled with a companion bill from the Senate Agriculture Committee, and then pass the House before heading to President Trump's desk.

What Section 604 of the CLARITY Act Does for Open-Source Developers

The developer protections Smith is defending are codified in Section 604 of the CLARITY Act, which embeds the Blockchain Regulatory Certainty Act (BRCA), a bipartisan measure introduced in January 2026 by Senators Cynthia Lummis and Ron Wyden. The BRCA's core function is straightforward: it prevents the government from prosecuting non-custodial software developers under the federal money-transmission statute (18 U.S.C. § 1960) or imposing Bank Secrecy Act obligations on them simply for publishing or maintaining open-source code.

Two related provisions round out the framework. Section 601 carves developers out of SEC registration requirements, and Section 207 exempts them from commodities law. Together, the three sections establish that writing software others use to transact, without holding, freezing, or moving user funds, does not make a developer a financial intermediary.

Smith's argument, articulated publicly ahead of the expected Senate vote, is that open-source developers, validators, and non-custodial wallet providers share a key characteristic: they neither custody user assets nor execute transactions on behalf of customers. Treating them as brokers, custodians, or money transmitters under frameworks designed for entities that do hold funds would, in Smith's view, create legal uncertainty that pushes development offshore.

Solana SOL$66.42+0.4%'s ecosystem depends heavily on this distinction. The network runs on open-source software maintained by contributors who are not agents of any single entity and do not control user funds. Any regulatory framework that fails to distinguish between code publishers and asset custodians creates direct legal risk for that contributor base.

60+ Crypto CEOs Sign Letter Backing Section 604

The Solana Policy Institute is not alone in this advocacy. More than 60 crypto executives and founders signed an open letter demanding that Section 604 remain intact, including Solana co-founder Anatoly Yakovenko, along with representatives from Coinbase, a16z crypto, Uniswap, Solana Labs, Kraken, Paradigm, Galaxy, and Ledger. A separate coalition of more than 200 companies organized through Stand With Crypto sent parallel letters to the Senate.

The letter's framing speaks to the stakes: "From core Bitcoin development to novel DeFi smart contract designs, developers need clear legal certainty to openly build, maintain, and contribute to community-driven software projects."

Blockchain Association CEO Summer Mersinger framed the broader case at the committee level: "The United States needs clear rules of the road."

The Legislative Path Is Narrow

The administration has publicly targeted passage before July 4. Galaxy Digital reduced its passage probability estimate to 60%, down from 75% in May, and JPMorgan has separately flagged a narrowing legislative window.

The outstanding complications are structural. The Senate Banking Committee's bill must be reconciled with the Senate Agriculture Committee's companion "Digital Commodity Intermediaries Act," which governs CFTC-facing aspects of the same framework. The two bills share broad intent but differ on DeFi treatment, stablecoin yield, taxonomy, and ethics provisions that have drawn bipartisan friction. Senator Alsobrooks, one of the two Democrats who voted yes on May 14, was careful to frame her vote as conditional: "My vote today is a vote to keep working in good faith," she told the committee.

The CLARITY Act then faces the House, where a separate version of the bill already passed in 2025. Reconciling the two chambers' texts adds another round of negotiation before any presidential signature.

Solana Policy Institute's Stake in the CLARITY Act Outcome

The Solana Policy Institute launched in 2025 specifically to represent the Solana ecosystem's interests in Washington policy debates. The CLARITY Act fight reflects the organization's core thesis: that regulatory outcomes on developer liability will shape where open-source blockchain infrastructure gets built, and that the US risks losing that work to friendlier jurisdictions if the definitions in market-structure legislation are drawn too broadly.

The Solana Policy Institute is also hosting a Washington x Wall Street event in Chicago on June 16, bringing together policymakers, regulators, institutional investors, and blockchain builders to discuss digital commodities, compliance, on-chain infrastructure, and the growing role of crypto in future elections.

The legal stakes underlying Smith's campaign are not abstract for the Solana ecosystem. The SPI donated $500,000 to the legal defense funds of Roman Storm and Alexey Pertsev, the Tornado Cash developers prosecuted under money-transmission statutes, a case that crystallized for many in the Solana community exactly what Section 604 is meant to prevent.

The Senate is expected to take up the CLARITY Act for a full floor vote before its August recess. Whether Section 604 survives that process intact will determine whether US-based open-source blockchain development gets a clear legal foundation, or whether developers are left working under the same legal ambiguity that produced the Tornado Cash prosecutions.