Even God Has a Problem With Section 604: 82 Catholic Leaders Tell Senate to Reject CLARITY

A coalition of 82 Catholic leaders and organizations urged Senate leaders in both parties on Tuesday to oppose a provision of the CLARITY Act, the market structure bill that would legalize most crypto activity in the United States, arguing the language could facilitate human trafficking and other illicit finance. The letter, organized by the Alliance to End Human Trafficking and first reported by Punchbowl News, was addressed to Senate Majority Leader John Thune and Minority Leader Chuck Schumer. "Catholic social teaching calls us to uphold solidarity, protect the vulnerable, and ensure that economic systems are ordered toward justice rather than exploitation," the signatories wrote. "The test of any financial system is not simply whether it generates wealth or innovation, but whether it safeguards human life and dignity," the letter continued.

The coalition specifically targeted Section 604 of the bill, known as the Blockchain Regulatory Certainty Act (BRCA), which would exempt non-custodial decentralized-finance developers, open-source code publishers, node operators and unhosted wallet providers from money-transmitter classification under the Bank Secrecy Act, removing them from related registration and reporting obligations. Industry groups have said BRCA is a red line and that they will not support the legislation without it. The provision has circulated in various legislative forms since at least 2018. The Catholic leaders argued BRCA "may make it more difficult to responsibly monitor illicit financial activity tied to trafficking, organized crime, child exploitation, sanctions evasion, and other forms of abuse." In the past year, the Trump Department of Justice has sent multiple crypto software developers to prison for creating tools that allow customers to make on-chain transactions private, the type of prosecutorial risk BRCA is designed to eliminate.

The bill cleared the Senate Banking Committee 15-9 on May 14, 2026, and still requires a full Senate floor vote. According to Polymarket, the implied probability that President Donald Trump signs CLARITY into law this year stood at roughly 41-42% as of Wednesday, down sharply on the day. The Catholic letter follows a separate June 23 correspondence to Acting Attorney General Todd Blanche and White House crypto advisor Patrick Witt, signed by the National District Attorneys Association, the National Association of Assistant U.S. Attorneys, the International Association of Chiefs of Police and the National Sheriffs' Association, representing more than 70,000 law enforcement professionals, who raised similar concerns about Section 604.

The provision is one of several sticking points. Wall Street is seeking language restricting stablecoin rewards, Native American tribes want clauses limiting prediction-market sports wagers, and some Democrats are demanding restrictions on the crypto ventures of President Donald Trump and his family. The bill must pass by next month, industry leaders have said, or it is unlikely to become law this year given the November midterms.