Trump crypto adviser encourages legislators to pass the flawed CLARITY Act now, warning that inaction may give Democrats the opportunity to impose discriminatory crypto regulations following a future crisis.
In a harsh warning to the industry, the crypto adviser to Trump said, either accept the CLARITY Act or be hit by more restrictive regulations in the future.
Patrick Witt wrote on X that the bill is not flawless, yet he emphasized the need to act as long as the conditions are in favor of crypto.
“No bill is better than a bad bill.”
What a privilege it is to be able to say those words thanks to President Trump’s victory, and the pro-crypto administration he has assembled.
But let’s not kid ourselves. There *will* be a crypto market structure bill — it’s a question of…
— Patrick Witt (@patrickjwitt) January 21, 2026
Source: Patrickjwitt
Will Democrats Seize Control After Crisis?
Witt made the decision straightforward: either enact the bill with a pro- crypto president and Congress, or have Democrats write punitive rules when a financial crisis strikes.
You may not like all of the CLARITY Act, Witt said on X., but I can assure you that you will despise a Democratic version even more in the future.
He gave Dodd-Frank as an example to be wary of, stating it occurred after the crisis of 2008 and altered the financial sector with stringent regulations.
The crypto market exists without detailed regulation by the federal government, and Witt referred to any prospect of perpetual existence as crypto-related as pure fantasy.
He commended the existing regulatory climate: SEC and CFTC are run by pro-crypto leaders in the Trump administration, and Congress is still Republican.
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Retail Investors Voice Concerns
Not everyone agrees with Witt’s assessment. CryptoWendyO replied on X with doubt regarding the bill.
You are not wrong, CryptoWendyO tweeted. And yet at the same time, this is the opportunity for retail to be in a position to, in fact, be able to get ahead.
She also included her anger with politicians by explaining, “It is such a shame to see how politicians are taking even more of us.
You are not wrong, but at the same time this is retails chance to actually be able to get ahead and it’s really sad watching public servants continue to take more from us.
— Wendy O (@CryptoWendyO) January 21, 2026
Source: CryptoWendyO
CryptoWithKris, another user, brought certain concerns to X. The issue of the yield of stablecoins is still subject to debate within the ongoing discussions.
CryptoWithKris warned, Do not underestimate the issue of stablecoin yield. “If the banks win now, it will never change.”
Don’t gloss over the stablecoin yield issue. If the banks win now it will never change.
— Blastoplast 💹🧲 (@CryptoWithKris) January 21, 2026
Source: CryptoWithKris
Senate Votes Require Compromise
Witt admitted that compromises would be needed; the Senate requires 60 votes to pass, and Republicans alone cannot get that number.
He encouraged further efforts by working to enrich the law, but he warned that perfectionism might stop the process completely.
The CLARITY Act will seek to create a definitive regulatory structure that will determine the jurisdiction between the SEC and CFTC over crypto assets.
The message that Witt conveys is a reflection of bigger industry tensions. Others believe that we should wait till we get terms that are more favorable, whereas others might not risk losing the political moment at hand.
The controversy illuminates the regulatory ambiguity of crypto. The pro-crypto attitude of Trump is setting a stage never seen before, yet that might not be the case after his tenure.