The Senate is grinding through the Crypto Clarity Act, with debate now centering on provisions that would bar individuals or entities with prior regulatory violations or fraud findings from participating in designated crypto market activities. The bad-actor provisions are modeled loosely on securities law disqualification frameworks and represent one of the more contentious elements slowing the bill's progress.
Armada's crypto repo desk needs to assess this carefully. If enacted, the provisions could impose a new layer of counterparty due diligence, particularly for market maker and family office clients who may have affiliates or principals with prior enforcement history. This intersects with existing KYC obligations but could require a formalized disqualification screening process before onboarding, affecting deal timelines and counterparty documentation.