Lowenstein Crypto advises leading digital asset and cryptocurrency projects, exchanges, and trading firms. Our practice covers regulatory advice, transactions and structuring advice, investigations, and adversarial matters including commercial disputes, bankruptcy, and related litigation. As these markets continue their rapid growth and market participants continue to evolve and mature their businesses, we are providing this weekly digest as a resource that highlights and summarizes a selection of key recent legal regulatory developments.

DCG Sends Letter Highlighting the Need for Regulatory Clarity 

On July 29, the Digital Currency Group (DCG) posted on social media a letter it sent to Senate Majority Leader John Thune (R-S.D.) and Minority Leader Charles Schumer (D-N.Y.) urging lawmakers to pass the Digital Asset Market Clarity Act (CLARITY Act) to keep talent, capital, and innovation in the United States. DCG states that the CLARITY Act delivers meaningful consumer protections, safeguards, and clear jurisdictional lines between the Securities and Exchange Commission and the Commodity Futures Trading Commission, which are needed to foster technological innovation in the United States. DCG further warns that without such clarity, companies may elect to choose jurisdictions that have been more welcoming and decisive from a regulatory perspective (e.g., Singapore, Abu Dhabi, the European Union, and the UAE). The U.S. Senate is scheduled for recess on August 8. See DCG’s post on X here.

New York Attorney General Submits Testimony Urging Congress To Strengthen Crypto Oversight

On July 27, New York Attorney General Letitia James testified before Congress to implement stronger regulations to protect consumers from cryptocurrency-related scams. Her statement highlighted that crypto fraud complaints to her office have nearly tripled over the past three years, with the FBI reporting a 21 percent increase in cryptocurrency complaints and $11.4 billion in losses in 2025, while TRM Labs estimated $158 billion in illicit cryptocurrency volume that year. James criticized the proposed CLARITY Act for preempting state investor-protection and anti-fraud laws at a time when federal enforcement is retreating, noting the DOJ’s April 2025 decision to curb prosecutions of digital asset platforms and the SEC’s rollback of enforcement actions and dismissal of several pending crypto litigations. The testimony also raised conflict-of-interest concerns tied to the current administration’s crypto ties, including reporting that Binance moved billions for Iran while holding a large share of the President’s family’s USD1 stablecoin, and that the President earned over $1.4 billion from crypto ventures in 2025. James closed by urging Congress to reject preemption of state authority and to adopt a series of reforms, including stricter know your customer/anti-money laundering compliance for crypto platforms, restrictions on officials regulating industries in which they hold financial interests, and mechanisms allowing law enforcement to freeze and recover illicitly obtained crypto assets. See the press release here and the written testimony here.

Community Bank Leaders Urge Congress To Adopt Substantially Similar Standard for Stablecoin Rewards

On July 28, community bank officers from state bankers associations across the United States sent a letter to Senate Majority Leader John Thune (R-S.D.) and Minority Leader Charles Schumer (D-N.Y.) urging targeted amendments to Section 10404 of the CLARITY Act before final passage. The bankers support the state associations’ proposed revisions to close potential loopholes that could let stablecoin issuers pay interest-like rewards through creatively structured incentives rather than direct interest. Specifically, they call for a clearer “substantially similar” standard barring rewards tied to a stablecoin’s holding period, duration, tenure, or balance, arguing that such incentives would functionally replicate deposit interest without the regulatory safeguards and community-lending obligations imposed on insured depository institutions. The signatories warn that if stablecoins can attract balances through these mechanisms, local deposit bases that fund mortgages, small-business loans, farm operations, and payrolls could be eroded by hundreds of billions of dollars, undermining Congress’ stated intent that payment stablecoins function as transaction tools rather than store-of-value products. The letter closes by urging the Senate to adopt these narrow changes to preserve room for responsible payment innovation while protecting the credit channels that communities depend on. See the letter here.

U.S. Treasury Releases Statement in Connection With EU-US Joint Regulatory Forum 

On July 24, the U.S. Department of the Treasury released a statement in connection with the EU-US Joint Regulatory Forum that took place in Brussels June 9-10, which brought together senior officials from U.S. and European regulators to discuss a broad range of financial regulatory topics. The forum opened the session with an exchange on digital finance policy priorities, including innovation in securities tokenization and tokenized collateral, the use of AI in financial services, and operational resilience considerations. EU representatives updated their U.S. counterparts on the ongoing review of the Markets in Crypto-Assets (MiCA) Regulation and on considerations informing the development of a digital euro, while U.S. participants reported on progress implementing the GENIUS Act and on broader U.S. digital asset policy initiatives. Both sides reaffirmed their commitment to continued dialogue on regulatory and supervisory issues of mutual concern, with the next forum expected in late 2026. See the statement here.

Thai SEC Alleges Bitkub Provided False Statements and Information in Connection With $50M Hack

On July 23, Thailand’s Securities and Exchange Commission (Thai SEC) filed a criminal complaint with the Economic Crime Suppression Division against Bitkub Online Co. Ltd. (Bitkub) alleging that the exchange provided false statements and information in connection with a 2021 hack. In May 2021, Bitkub was subjected to a cyberattack involving approximately $50.6 million worth of digital assets being withdrawn from the exchange. Thereafter, the Thai SEC alleges that Bitkub claimed to have replaced the stolen digital assets; however, Bitkub failed to report changes to its daily net capital report consistent with the hack and allegedly made false entries in its reporting obligations in an attempt to deceive the Thai SEC. See the press release here.