US Lawmakers Introduce Bill to Protect Blockchain Developers from Prosecution
By John Nada·Feb 26, 2026·5 min read
US lawmakers have introduced a new bill to protect blockchain developers from prosecution, aiming to redefine legal standards for digital asset control.
A bipartisan group of lawmakers in the US House of Representatives has introduced legislation aimed at halting prosecution of software developers who do not have custody or control of others’ crypto assets. On Thursday, Representatives Scott Fitzgerald, Ben Cline, and Zoe Lofgren announced that they would be sponsoring the Promoting Innovation in Blockchain Development Act. This legislative effort seeks to change how criminal cases involving blockchain developers are handled, reflecting a growing recognition of the need for clear guidelines in the rapidly evolving digital landscape.
The proposed bill is designed specifically to clarify that Section 1960 under US federal law, which prohibits illegal money transmitting businesses, would only apply to individuals who have control over others’ digital assets. This distinction is crucial as it aims to protect developers who create and maintain blockchain technology without taking custody of users' funds. The bill's intent is to foster an environment that encourages innovation while safeguarding developers from the looming threat of criminal prosecution.
At least two prominent crypto advocacy organizations have publicly supported the bill. The Blockchain Association has called it a “critical step” toward encouraging US-based developers to engage in blockchain innovation without fear. Similarly, the DeFi Education Fund (DEF) has echoed this sentiment, stating that the legislation would likely put a stop to prosecutions similar to those faced by Tornado Cash developer Roman Storm and the creators of the Samourai Wallet. DEF emphasized that the bill clarifies that software developers who do not take custody of or control others' money can build neutral technology domestically, without the fear of being treated as financial intermediaries subject to criminal charges.
The urgency of this legislation is underscored by recent prosecutions in the blockchain space. For instance, Roman Storm was found guilty of operating an unlicensed money transmitter business in August 2025. His case serves as a cautionary tale, highlighting the risks faced by developers who inadvertently fall under the scrutiny of financial regulators. Additionally, the founders of the Samourai Wallet, Keonne Rodriguez and Will Lonergan Hill, pleaded guilty to similar charges in July and were sentenced to five and four years in prison, respectively. These cases exemplify the precarious situation that blockchain developers currently navigate, which has prompted lawmakers to take action.
As of Thursday, Storm had yet to be sentenced or face a possible retrial for two other charges. The uncertainty surrounding these cases emphasizes the necessity for legislative measures that provide clearer definitions and protections for developers. While the Promoting Innovation in Blockchain Development Act aims to redefine the landscape for those creating blockchain technology, it remains unclear whether it would retroactively affect previously filed cases against developers who have already faced legal action.
In the Senate, discussions around developer protections are also underway. Senators Cynthia Lummis and Ron Wyden have introduced their own piece of legislation known as the Blockchain Regulatory Certainty Act. This proposal aims to further clarify that developers who are engaged in writing code or maintaining networks do not meet the criteria for being criminally liable as unlicensed money transmitters. The introduction of these bills signals a significant shift in how lawmakers are beginning to approach the intersection of technology and regulation.
The Senate's consideration of a broader digital asset market structure is particularly noteworthy. In July 2025, the House sent a comprehensive digital asset market structure bill to the Senate, which is still under review. The CLARITY Act, a component of this larger initiative, was passed by the Senate Agriculture Committee in January, yet it has not been addressed with a markup in the Senate Banking Committee. This ongoing legislative process indicates that lawmakers are grappling with how best to regulate the burgeoning crypto industry, without stifling innovation.
However, the path forward is fraught with challenges. Some lawmakers express concerns that blanket protections for developers may inadvertently shield bad actors within the space. This pushback highlights the complexities involved in crafting legislation that balances the need for innovation with the imperative of consumer protection and regulatory oversight. The discussions surrounding the CLARITY Act, coupled with the proposed developer protections, illustrate the delicate balancing act that lawmakers must perform as they navigate the rapidly evolving digital asset landscape.
In the context of these developments, the broader implications for the US’s stance on blockchain innovation cannot be overstated. Establishing a framework that fosters technological advancement while minimizing the threat of criminal liability could position the US as a leader in the global blockchain ecosystem. This potential shift could attract more developers and innovation to the country, ultimately enhancing its competitive edge in the digital economy.
As the legislative discussions unfold, it will be critical for lawmakers to engage with stakeholders in the crypto community, including developers, investors, and advocacy groups. Open dialogue will be essential in ensuring that the resulting legislation is not only comprehensive but also reflective of the needs and concerns of those directly involved in the blockchain space. The introduction of the Promoting Innovation in Blockchain Development Act marks a pivotal moment in the evolution of US policy towards blockchain technology and its developers.
Ultimately, the success of these legislative efforts will depend on the ability of lawmakers to navigate the complexities of the digital asset landscape while fostering an environment that promotes innovation and protects developers. As the situation develops, the eyes of the crypto community and the broader public will be watching closely, eager to see how these proposed changes will impact the future of blockchain development and its role in the American economy. The outcome of these discussions may well set the tone for the future regulatory landscape of cryptocurrencies and blockchain technology in the United States.