New York Attorney General Letitia James has voiced strong concerns about the Digital Asset Market Clarity Act, commonly known as the CLARITY Act, arguing that the federal proposal risks weakening the capacity of states to combat cryptocurrency-related fraud and protect investors. Beyond jurisdictional issues, James called for enhanced anti-money-laundering requirements, know-your-customer protocols, and cybersecurity standards for crypto platforms. The testimony arrives amid efforts in Congress to advance the first comprehensive federal framework for crypto market structure, with lawmakers seeking a Senate floor vote. Supporters of the CLARITY Act argue it would provide needed regulatory clarity to foster innovation while incorporating certain fraud and anti-money-laundering measures. Critics, including James, maintain that federal preemption could leave gaps precisely where state authorities have demonstrated effectiveness in protecting residents.