NY AG Warns CLARITY Act Could Weaken State Crypto Enforcement

Letitia James testifies that federal bill undermines state fraud powers, citing 3x rise in complaints and $500M losses.

Woofun AI reports that New York Attorney General Letitia James submitted written testimony to U.S. Congress, urging stricter cryptocurrency regulation. She warned that the Digital Asset Market Clarity Act would preempt state oversight and transfer authority to the CFTC, weakening local enforcement capabilities.

James disclosed a threefold increase in crypto fraud complaints over three years, with five-year losses nearing $500 million. She demanded platforms adhere to AML, KYC, and cybersecurity standards while monitoring suspicious activity and accepting financial liability for fraud failures.