Cardano founder Charles Hoskinson blasted the proposed Digital Asset Market Clarity Act as “horrific,” renewing his criticism of Ripple CEO Brad Garlinghouse for supporting the bill. Hoskinson says the measure would effectively treat many tokens as securities and would fail to address regulatory gaps in DeFi and prediction markets.
Using XRP as an example, Hoskinson argued that the bill’s definitions and framework would label tokens created to raise blockchain funding as investment contracts subject to SEC oversight. That designation, he warned, would prevent such assets from being listed on crypto exchanges and instead require them to trade through broker-dealers as securities.
The draft law ties commodity treatment under the CFTC to whether an asset runs on a “mature” blockchain — one that is fully decentralized and not controlled by a single person or aligned group. Hoskinson said that standard would have disqualified XRP at its 2012 launch because of founder centralization, and he suggested networks such as Cardano and Ethereum could face similar scrutiny depending on their development and governance histories.
He cautioned that, under the bill, “everything starts as a security,” forcing creators to petition the SEC for reclassification. Hoskinson said the proposal lacks protections for developers and risks locking new projects into perpetual security status, limiting how tokens can be listed and traded.
Proponents of clarity argue the opposite. JPMorgan has suggested that passage of the Clarity Act could unlock substantial market gains in the back half of 2026 by removing regulatory uncertainty and attracting institutional investors. The bill, however, missed a March 1 deadline amid a dispute over stablecoin yield rules. Lawmakers from both parties continue to negotiate provisions, but the debate over how to classify and regulate digital assets remains unresolved.