Cardano founder Charles Hoskinson has once again criticized the Clarity Act, arguing that while tokens like XRP and ADA might receive a free pass, the overall bill could hurt the crypto industry.
As debate around the bill intensifies, Hoskinson has become one of its strongest critics. He recently argues that the law could end up labeling most digital assets as securities by default. He also warned that this would give the U.S. SEC more power and could push decentralized finance (DeFi) out of the picture.
Key Points
- Charles Hoskinson believes that the Clarity Act could grant XRP a regulatory “free pass” by affirming its non-security status.
- He argues that the bill may automatically classify most future crypto projects as securities, increasing regulatory pressure on new entrants.
- Hoskinson criticizes the legislation for failing to include clear provisions for DeFi platforms such as Uniswap and for ignoring prediction markets.
- He suggests that Coinbase remains the primary force shaping the bill’s trajectory due to its interest in stablecoin-related provisions.
XRP Might Get a Free Pass
During a recent livestream, Hoskinson said the Clarity Act could absolve established tokens like XRP and ADA from being labeled securities. His remarks echo those of Brad Garlinghouse, who maintains that XRP has already secured non-security status through a U.S. federal court ruling.
However, despite the potential benefits for XRP and ADA, Hoskinson warned that the bill’s wider implications remain troubling. He argued that the legislation risks turning nearly all crypto assets into securities by default, effectively granting the SEC sweeping power.
In turn, this could stifle future American crypto projects through restrictive oversight. Rather than fostering clarity, Hoskinson believes the Act would foster uncertainty and enforcement-driven governance.
“It looks like XRP might get a free pass”
— Cobb (@Cobb_XRPL) March 3, 2026
No Provisions for DeFi
He also expressed frustration over the lack of provisions for DeFi platforms. According to him, protocols such as Uniswap and prediction markets receive no meaningful provision under the bill.
Without explicit recognition, decentralized protocols could remain vulnerable to regulatory crackdowns. Moreover, he noted that the legislation omits provisions for yield-bearing stablecoins, an area in which Coinbase has actively advocated.
“New Crypto Projects Will Be Securities by Default’
Hoskinson also opposes the Clarity Act for several other reasons. He argued that the bill would classify all new crypto projects as securities by default, placing an immediate regulatory burden on emerging developers.
According to Hoskinson, such a framework could hand lawmakers, particularly Democrats who have frequently criticized the industry, a legal mechanism to keep most digital assets permanently categorized as securities. To him, this approach would strip developers of meaningful protections while entrenching long-term regulatory constraints.
Hoskinson further emphasized that assets labeled as securities often struggle to secure sufficient liquidity, limiting issuers’ ability to expand token ownership and grow their networks. For Cardano’s founder, these structural limitations underscore why he remains strongly opposed to the legislation.
Coinbase Emerges as Key Roadblock to Clarity Act
The Clarity Act, widely viewed as a pathway to long-awaited regulatory clarity for the crypto industry, continues to spark mixed reactions. Although the Senate Agriculture Committee has advanced its markup, the Banking Committee has stalled over disagreements over the yield-bearing stablecoin provision.
Earlier this year, Coinbase withdrew its support after discovering that the bill does not permit stablecoin yields. In response, the White House convened meetings between crypto and banking stakeholders to broker a compromise. Despite a March 1 deadline, officials have yet to announce any compromise. Nevertheless, industry participants remain optimistic that negotiations could still produce a deal.
Meanwhile, Hoskinson identified Coinbase as the primary obstacle to advancing the bill, citing its push to offer yield-bearing stablecoins. He argued that the exchange presents the effort as retail advocacy while ignoring deeper structural concerns affecting the broader ecosystem.
Despite these criticisms, Garlinghouse maintains that the current version of the bill is preferable to continued regulatory uncertainty. Consequently, he believes the U.S. president could enact the legislation as soon as next month.
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