Executive Summary
The two Statements reinforce a consistent PGPZ message: policymakers should focus regulation on actors that actually take custody, exercise control, or perform intermediary functions, while protecting the development of neutral, non-custodial software. At the same time, financial privacy should be treated as a legitimate and essential policy objective instead of inviting regulatory scrutiny. By placing these principles into the congressional record, PGPZ is helping shape the debate around digital asset legislation, anti-money-laundering policy, developer protections, and the role of privacy-enhancing technologies in a modern financial system.
July 17 Hearing—Building the Future of Finance: How the CLARITY Act Unlocks Innovation
In response to the Digital Assets Subcommittee’s July 17 hearing, “Building the Future of Finance: How the CLARITY Act Unlocks Innovation,” PGPZ focused on the importance of preserving explicit protections for non-custodial software developers in the Digital Asset Market Clarity Act (CLARITY Act), including the provisions associated with the Blockchain Regulatory Certainty Act. The Statement explains that developers who write code, publish software, or provide tools without taking custody or control of users’ assets are not functioning as money transmitters or traditional financial intermediaries. It argues that these protections would codify, not depart from, FinCEN’s existing approach, while giving developers greater legal certainty and helping the United States remain competitive with jurisdictions such as the European Union and the United Arab Emirates, which have already recognized exclusions for decentralized services and self-custody.
Read the Statement for the Record here.
July 21 Hearing—Oversight of the Financial Crimes Enforcement Network
PGPZ’s second Statement responded to the July 21 National Security, Illicit Finance, and International Financial Institutions Subcommittee hearing, “Oversight of the Financial Crimes Enforcement Network.” That submission advanced two related priorities: preserving the bright-line distinction in FinCEN’s 2019 guidance for non-custodial developers and promoting privacy-preserving technologies as solution to indiscriminate financial surveillance. The Statement cautions that expansive reporting requirements and centralized repositories of sensitive financial information can create substantial financial privacy and misuse risks. It emphasizes that technologies such as zero-knowledge proofs and viewing keys can allow individuals or businesses to prove relevant facts or selectively disclose transaction information without exposing their full financial histories. Zcash provides a practical example of this approach, demonstrating that strong privacy protections can coexist with targeted compliance, auditing, and regulatory oversight.
Read the Statement for the Record here.