Writing software shouldn’t be a felony. That’s the core argument from Kyle Olney, co-founder of SaveOurWallets.org, who is warning that Senate negotiations over the Digital Asset Market Clarity Act could strip away protections that keep non-custodial developers from being treated like money transmitters under federal law.

The concern centers on the Blockchain Regulatory Certainty Act, or BRCA, a provision that passed the House with roughly 70% bipartisan support and was folded into the House version of the CLARITY Act (H.R. 3633). If that carve-out gets diluted or dropped during Senate deliberations, Olney argues, developers who build wallets, decentralized protocols, and other non-custodial tools could face criminal liability under existing money transmission statutes.

What the BRCA actually does

The BRCA is a narrow but important piece of legislation. It exempts developers and infrastructure providers who never take custody of user funds from being classified as money transmitters at the federal level. It doesn’t touch Anti-Money Laundering rules for custodial entities like exchanges. It simply draws a line between people who hold your money and people who write software.

Senate discussions have reportedly drifted toward stablecoin yields and other topics, raising fears among industry advocates that the BRCA’s protections are being traded away.

The prosecutions that changed everything

Olney’s warning isn’t hypothetical. It’s grounded in a string of 2025 prosecutions that sent a chill through the developer community.

Tornado Cash developer Roman Storm faced charges related to his work on the privacy-focused mixing protocol. Samourai Wallet’s Keonne Rodriguez and William Lonergan Hill were similarly prosecuted. In both cases, the defendants built non-custodial tools. They never held user funds. They wrote and published code.

These cases established a de facto precedent that alarms open-source developers. If the BRCA’s protections are weakened in the CLARITY Act, that precedent wouldn’t just stand. It would be reinforced by the absence of explicit statutory protection.

The talent migration threat

Olney warns that weakening the BRCA could trigger a mass exodus of blockchain developers to jurisdictions that have established clearer, more favorable regulatory frameworks. Singapore, Switzerland, and the UAE are the usual suspects, all of which have spent years positioning themselves as crypto-friendly destinations.

Olney also connects the issue to the emerging intersection of blockchain and artificial intelligence. He references NVIDIA’s projection of a $1 trillion market for AI agents, many of which would depend on blockchain infrastructure for autonomous transactions and identity verification. If the US regulatory environment makes it risky to build that infrastructure domestically, the agentic economy, as Olney calls it, will simply develop somewhere else.

What this means for investors

If the BRCA is weakened or removed from the CLARITY Act, the competitive position of US-based crypto projects deteriorates. Developers build where they feel safe. Investors follow developers. Capital follows investors.

For anyone holding positions in US-based DeFi protocols or infrastructure projects, the trajectory of this legislation is worth monitoring closely. A strong BRCA inclusion would signal that Washington understands the difference between building tools and operating financial services. A weakened version, or outright removal, would signal the opposite.

Europe’s MiCA framework is already live. The UAE’s VARA regime is operational. Singapore’s licensing framework continues to attract projects. Each of these jurisdictions has made deliberate choices to create environments where developers can build without wondering if their next commit will be Exhibit A in a federal prosecution.