Sponsors (2)
The bill reduces compliance burdens and legal uncertainty for many blockchain developers to encourage innovation, but it does so at the cost of reduced oversight and potentially fewer legal remedies for users, raising risks of fraud, money‑laundering, and enforcement gaps.
Non-controlling software developers and infrastructure providers will not be treated as money transmitters federally, cutting registration and compliance costs for many tech firms and startups.
Developers and firms building distributed ledger infrastructure gain clearer federal legal status for providing custody-enabling tools, reducing legal uncertainty and encouraging innovation.
States retain the ability to enforce consistent state laws where they align with the section, allowing local consumer protections and law-enforcement actions to continue in many cases.
Consumers and the financial system could face higher fraud and money‑laundering risks if exempting non-controlling providers reduces federal oversight of systems that facilitate value transfers.
Users injured by developer conduct in jurisdictions where the section preempts inconsistent claims may have fewer legal remedies at the state or local level.
Developers whose behavior falls near the boundary of the 'non-controlling' definition will still face legal uncertainty and potential state or federal enforcement, leaving some companies exposed to compliance risk.
Based on analysis of 2 sections of legislative text.
Exempts non-controlling developers/providers of distributed ledger services from federal money-transmitter status and related registration requirements for specified activities.
Official title: Clarify the treatment of certain non-controlling developers or providers of distributed ledger services involved in digital assets with respect to money transmission laws, and for other purposes.
Introduced January 12, 2026 by Cynthia M. Lummis · Last progress January 12, 2026
The bill says that developers or providers of distributed ledger services who do not control or custody users’ funds are not to be treated as money transmitters under federal money-transmission law and are exempt from related federal registration requirements for those developer/provider activities. It defines key terms (digital asset, distributed ledger, distributed ledger service, non-controlling developer or provider) and makes the exemption effective on enactment while preserving other federal and state authorities and legal frameworks that are outside the limited exemption.