PGPZ Community Weekly Policy Memos

Ecosystem Updates
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Weekly Policy Memo: June 15, 2026

Hi everyone,

This week’s PGPZ Community policy memo covers the FinCEN AML rulemaking, Illinois crypto tax, and stablecoin customer-identification requirements.

Key Takeaways

  • Members of Congress wrote to FinCEN, urging it to reduce low-value “defensive reporting,” update decades-old reporting thresholds, and fully support the integration of mature artificial intelligence systems to track illicit actors effectively as part of a recent rulemaking proposal.

  • New Illinois law, becoming effective Jan. 1, 2027, imposes a first-in-the-nation 0.2% “privilege tax” on all Illinois crypto transactions (exchanges, transfers, and storage).

  • FinCEN and the federal banking regulators proposed a rule that formally designates U.S. stablecoin issuers as financial institutions under the BSA and requires them to establish, document, and maintain comprehensive Customer Identification Programs. This mandates that stablecoin platforms verify the identities of the individuals and entities utilizing their services for primary market activities, such as direct issuance and redemption.

Action Items

  • Consider following Members of Congress such as Rep. French Hill and Rep. Warren Davidson on social media and showing support by liking, reposting, and commenting on related announcements and developments.

  • Illinois residents should consider migrating their crypto to noncustodial wallets before December 31, 2026, to legally move your funds off centralized exchanges and avoid the upcoming 0.2% transaction tax.

  • Contact your local Illinois lawmakers to push for amendments exempting P2P transfers and noncustodial software.

  • Interested stakeholders should consider participating in the public comment period to highlight how rigid onboarding mandates for digital asset base pairs might impact user privacy and the technical architecture of decentralized networks.

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House Financial Services Committee Leadership Urges FinCEN to Reorient AML Rules Toward High-Risk Threats

On June 16, House Financial Services Committee Chairman French Hill (R-AR) and Subcommittee on National Security, Illicit Finance, and International Financial Institutions Chairman Warren Davidson (R-OH) published a letter to Andrea Gacki, Director of the Financial Crimes Enforcement Network (FinCEN), providing formal comments on FinCEN’s Notice of Proposed Rulemaking (NPRM) regarding Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) Programs, highlighting it as a critical opportunity to prioritize risk within Bank Secrecy Act (BSA) implementation. The proposed rule, which implements the GENIUS Act’s anti-money laundering and sanctions compliance program requirements, encourages innovation in payment stablecoins while providing an appropriately tailored regime to mitigate potential illicit finance risks.

The lawmakers stated that current BSA enforcement overemphasizes process over outcomes, penalizing irrelevant technical failures and driving compliance resources into liability mitigation rather than actual risk identification. They urged FinCEN to execute the core tenets of the Anti-Money Laundering Act of 2020 (AMLA), reduce low-value “defensive reporting,” update decades-old reporting thresholds, and fully support the integration of mature artificial intelligence systems to track illicit actors effectively.

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Why this matters for Zcash

  • Financial institutions often rely on reflexive defensive reporting by filing millions of low-value Suspicious Activity Reports (SARs) out of legal caution. Applied to stablecoins, this dynamic creates friction for privacy-enhanced assets, as compliance departments often default to blanket restrictions or disproportionate profiling rather than assessing actual underlying risk. If FinCEN adopts the lawmakers’ recommendation to prioritize high-value intelligence over sheer reporting volume, legitimate privacy-centric interactions could face less automated profiling by financial intermediaries.

Action Item

  • Consider following Members of Congress such as Rep. French Hill and Rep. Warren Davidson on social media and showing support by liking, reposting, and commenting on related announcements and developments.

Illinois Becomes First U.S. State to Levy Direct Privilege Tax on Cryptocurrency Transactions

On June 16, Illinois Governor J.B. Pritzker signed a sweeping $55.9 billion state budget bill into law. Tucked inside the revenue provisions of this budget is a first-in-the-nation cryptocurrency transaction tax via the Digital Asset Tax Act (DATA).

The law creates a 0.2% “privilege tax” on the value of all “digital asset business activity”— defined broadly as the exchange, transfer, or storage of digital assets. Scheduled to take effect on January 1, 2027, the tax functions like a sales tax passed directly to the consumer. Any business or platform based in Illinois or out-of-state entities facilitating these activities that generates more than $100,000 in annual gross receipts from Illinois residents would legally classified as a “digital asset broker” and required to track, collect, and remit this tax monthly.

Notable Posts

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Why this matters for Zcash

  • This law affects Zcash users in Illinois who use centralized platforms like Coinbase, Kraken, and Gemini, as the platforms will be required to log every purchase, trade, or withdrawal of crypto, including Zcash, and tack on the 0.2% tax, including transfers from a custodial wallet to a noncustodial wallet.

  • For noncustodial wallets, sending Zcash peer-to-peer directly to another user’s non-custodial wallet means the tax cannot be enforced, as true P2P transfers do not use a centralized intermediary that would meet the “broker” definition. Because noncustodial wallets do not hold funds or collect revenue, it does not trigger the $100,000 broker threshold. However, the law may impact users who use a noncustodial wallet’s internal swap functions, which rely on decentralized backend partners. While a noncustodial wallet interface is just code, the external liquidity providers, DeFi frontends, and market makers that execute the cross-chain swaps would likely be considered to be operating for-profit businesses because they collect fees. If these underlying protocols clear $100,000 in gross receipts from crypto trades originating in Illinois, the state considers them “brokers.” This may result in companies blocking Illinois residents or limiting available features via geofencing.

Action Items

  • Zcash holders may want to consider moving funds from a centralized platform to a noncustodial wallet to avoid the .2% tax prior to December 31, 2026.

  • If you are in Illinois, call your local state representative and senator, framing the law’s implementation as a consumer privacy and data security issue. Explain that the law forces platforms to aggressively log and track the financial data of everyday citizens to prove whether they reside in Illinois, potentially creating a honeypot for hackers. Push for a legislative amendment to clearly exempt noncustodial software and peer-to-peer transfers entirely.

  • Keep a close eye on incoming lawsuits from organizations like the Crypto Council for Innovation (CCI), Blockchain Association, the Digital Chamber, and Coin Center. Interested Community members can support by amplifying their legal findings and donating to defensive legal funds.

FinCEN and Federal Banking Regulators Propose Joint Identity Verification Rules for Stablecoin Issuers

On June 18, the Board of Governors of the Federal Reserve System, FinCEN, the Federal Deposit Insurance Corporation (FDIC), the Office of the Comptroller of the Currency (OCC), and the National Credit Union Administration (NCUA) issued a joint NPRM. The proposal outlines new regulatory provisions for stablecoin issuers under the GENIUS Act.

The proposed rule formally designates “Permitted Payment Stablecoin Issuers” (PPSIs) as financial institutions under the BSA and requires PPSIs to establish, document, and maintain comprehensive Customer Identification Programs (CIP). This mandates that stablecoin platforms verify the identities of the individuals and entities utilizing their services for primary market activities, such as direct issuance and redemption.

Why this matters for Zcash

  • While this NPRM specifically targets stablecoin issuers, its compliance mandates carry implications if a stablecoin is issued as a Zcash Shielded Asset (ZSA). With respect to the broader Zcash ecosystem:

  • Implementing strict bank-level CIP requirements at the stablecoin layer means that the stablecoin-to-Zcash exit points would be anchored to verified user identities.

  • Centralized platforms that support both permitted payment stablecoins and privacy-preserving assets like Zcash will operate under heightened BSA compliance scrutiny. This could lead intermediaries to adjust their internal risk assessments, potentially influencing asset listings, deposit/withdrawal protocols, or compliance auditing for privacy-enhanced transactions.

  • If stablecoin protocols introduce more rigid compliance and identification features to satisfy federal oversight, decentralized applications and cross-chain bridges utilizing stablecoin liquidity pools to swap into Zcash may experience operational friction, enhanced monitoring, or geographic restrictions.

Action Item

  • For companies that are part of the Zcash ecosystem, interested stakeholders should consider participating in the public comment period to highlight how rigid onboarding mandates for digital asset base pairs might impact user privacy and the technical architecture of decentralized networks.
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Weekly Policy Memo: Week of June 22, 2026

Originally posted at: Weekly Policy Memo: Week of June 22, 2026 | PGPZ Coalition

This week’s PGPZ Community policy memo covers CBDC prohibition until 2030; Mining and Staking Tax Deferral; Texas makes 180-degree turn on data center and mining policy.

Key Takeaways

  • The U.S. Senate voted to pass a comprehensive housing affordability package that also bars the Federal Reserve from engineering or issuing a CBDC until 2030.
  • Digital asset trade associations called on the House Ways and Means Committee, which oversees tax legislation, to pass H.R. 9175, Tax Clarity for Mining and Staking Act, as introduced so that mining and staking rewards are only taxed when realized.
  • Texas is mandating that data centers fully fund their upfront electric transmission hookup infrastructure.

Action Items

  • Show support for H.R. 9175 by liking and reposting content on social media. If you are a constituent of a Congressperson who is on the Ways and Means Committee, call their office and tell them you support H.R. 9175 in its current form.
  • If you are a Zcash miner in Texas, reach out with any feedback on how this will impact your operations.
  • Encourage your friends to join the PGPZ Community! Reposting PGPZ content and citing our work products also helps increase awareness and helps socialize PGPZ talking points.

X Post of the Week

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Bipartisan Housing Legislation Heading to President’s Desk Includes Statutory Retail CBDC Ban Through 2030

The U.S. Senate voted 85–5 to pass H.R.6644, the 21st Century ROAD to Housing Act, a comprehensive housing affordability package, which includes a critical bicameral compromise that bars the Federal Reserve from engineering or issuing a retail Central Bank Digital Currency (CBDC) until at least 2030. The statutory ban reflects deep skepticism towards a Fed-issued CBDC, although administrative windows remain open for wholesale settlement tokenization experiments.

The signing ceremony was initially scheduled for Thursday, June 25, but President Trump postponed it, conditioning the signature on Congress passing H.R. 8281, the Safeguard American Voter Eligibility (SAVE) Act, voter ID legislation. On Monday, June 29, the House Speaker Mike Johnson (R-LA) will send the bill to the White House for signature, with the SAVE Act still working through the Senate. The president will have 10 days (excluding Sundays) to sign the bill or veto it; typically, if the president does not act, the bill would automatically become law. However, since the 10-day window starts Monday and would end on July 10, occurring while the Senate is out of session from June 29-July 10, the bill can fail via pocket veto.

Why this matters for Zcash

This statutory restriction against CBDC protects digital assets used for payments against a state-monopolized financial infrastructure. By establishing a clear legislative boundary that prevents the federal government from competing with private-sector transactional rails, Congress preserves room for U.S. digital asset payments innovation. A retail CBDC, which would inevitably crowd out alternative forms of payments, would also present privacy risks to users as efforts increase to enable government agencies to engage in financial surveillance. If the bill is not enacted, the CBDC ban will not become effective.

Action Items

No action needed.

Relevant Posts

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Digital Asset Coalitions Urge Unaltered Passage of H.R. 9175 to Normalize Mining and Staking Tax Deferral

The Blockchain Association, Crypto Council for Innovation, and the Digital Chamber have called on the House Ways and Means Committee, which oversees tax legislation, to pass H.R. 9175, Tax Clarity for Mining and Staking Act, as introduced. The draft legislation structures the tax treatment of block rewards, providing that mining and staking rewards must only face taxation when assets are sold rather than being assessed as ordinary income immediately upon receipt.

Why this matters for Zcash

This legislation levels the playing field for block rewards with respect to taxation, preventing them from being taxed twice—when the reward is received and again when the asset is sold. Currently, a Zcash mining operation must continually account for and liquidate portions of block rewards to satisfy immediate ordinary income tax obligations upon generation, creating extensive cash-flow complications. Shifting the taxable event to realization dramatically reduces operational costs for distributed infrastructure providers in the United States and makes it easier to use for payments Zcash block rewards that miners earn.

Action item

Show support for this legislation by liking and reposting content on social media. If you are a constituent of a Congressperson who is on the Ways and Means Committee, call their office and tell them you support H.R. 9175 in its current form.

Relevant Posts

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Texas Directs Regulators to Enforce Upfront Grid Infrastructure Funding Requirements on Data Centers

Texas Governor Greg Abbott issued an executive directive to the Public Utility Commission and ERCOT, which manages the flow of electric power to ~90% of the state’s electric load, to finalize a joint regulatory memorandum by July 17, mandating that massive computing facilities and digital asset miners fully fund their upfront electric transmission hookup infrastructure. The action seeks to shift grid infrastructure expansion costs away from residential ratepayers, creating a major test case for how distributed mining node operators can utilize their unique load flexibility to protect their underlying network access parameters.

Why this matters for Zcash

This policy takes a 180-degree turn from Texas’ previous position that encouraged data centers to build/relocate to Texas through cheap land, minimal regulatory friction, and tax incentives.

Action Items

If you are a Zcash miner in Texas, reach out with any feedback on how this will impact your operations.

Relevant Posts

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House Financial Services Committee Field Hearing Investigates How the CLARITY Act Unlocks Financial Innovation

The House Financial Services Committee announced it will hold a hearing on July 17, entitled “Building the Future of Finance: How the CLARITY Act Unlocks Innovation.”

Why this matters for Zcash

One of the key issues remaining as the Senate looks to finalize the CLARITY Act is around developer protections that are included in the Blockchain Regulatory Certainty Act, which provides that non-custodial developers are not money transmitters. This hearing is an opportunity to advocate for preserving the developer protections that are in the legislation. If the legislation passes in the Senate, it will need to head back to the House for another vote to reconcile the changes.

Action Items

Repost/share content on social media that promotes preserving the developer protections in the CLARITY Act. If you are a constituent of a Congressperson who is on the House Financial Services Committee, call their office and tell them you support the Blockchain Regulatory Certainty Act.

House Financial Services Committee Evaluates Anti-Money Laundering Frameworks in FinCEN Oversight Hearing

The House Financial Services Committee will conduct a full committee oversight hearing on July 21, entitled “Oversight of the Financial Crimes Enforcement Network.” Andrea Gacki, Director of FinCEN, will testify as the sole witness.

Why this matters for Zcash

This hearing is an opportunity for Congress to question the head of FinCEN on current priorities as they relate to digital assets, how FinCEN is thinking about applying the Bank Secrecy Act (BSA) and AML/KYC requirements to stablecoins (which would impact a stablecoin issued as a ZSA), and other topics.

Action Items

No action needed at this time.

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Weekly Policy Memo: June 29, 2026

Originally posted at: ** Weekly Policy Memo: June 29, 2026 | PGPZ Community**

This week’s PGPZ Community policy memo covers a PGPZ Progress Update and CLARITY Act Talks and Prospects

Key Takeaways

  • In its inaugural month, PGPZ successfully established itself as a central policy hub for Zcash, launching key workstreams across critical regulatory areas (such as financial privacy, tax, and AML) and setting up coordinated communication and reporting channels.
  • The month culminated in a June 30 Kickoff Breakfast at the Blockchain Association, building momentum for upcoming advocacy efforts and events, including the ZODL Summit in Prague (July 8–10).
  • The CLARITY Act’s prospects for enactment in 2026 have become increasingly uncertain due to a compressed Senate legislative calendar ahead of the August recess.

Action Items

  • Help us spread awareness by inviting friends and colleagues to join the Community and Coalition.
  • Call your Senator’s office to advocate for the passage of the CLARITY Act with developer protections preserved.

X Post of the Week

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June Monthly Update on PGPZ

PGPZ has successfully completed its first month, establishing itself as a dedicated hub for policymakers, regulators, and industry stakeholders focused on Zcash. This inaugural month was defined by the launch of key coalition workstreams across critical policy areas—including Mining, Tax, Financial Privacy, Market Structure, Developer Policy, AML/Sanctions, Payments/Stablecoins, and State Policy—as well as the establishment of coordinated communication channels, such as Signal groups and the Community and Coalition websites, to ensure a unified voice for the ecosystem. The month culminated in the June 30 Kickoff Breakfast at the Blockchain Association office, setting the stage for future engagement and advocacy efforts.

PGPZ Progress Summary

Here is a summary of PGPZ progress to date:

  • Launched the PGPZ Community and Coalition Sites
    • Developed PGPZ Policy Principles and Messaging
    • Created Coalition Workstreams
      • Mining
      • Tax
      • Financial Privacy
      • Market Structure
      • Developer Policy
      • AML and Sanctions
      • Payments and Stablecoins
      • State Policy
  • Established the Community and Coalition Signal Chat Groups
  • Published Weekly Policy Memos
    • Narrow/targeted weekly policy memos focusing on impact to Zcash ecosystem with action items for grass roots advocacy and engagement.
  • Published Special Updates
    • Report: U.S. Digital Asset Policy H1 2026 recapping policy developments from the first half of 2026, focusing on implications for the Zcash ecosystem.
    • Report: FinCEN/OFAC Stablecoin NPRM Comment Letter Summary and Implications for Zcash that focuses on summarizing comment letters that impact the Zcash eco-system (e.g., comments that support or oppose privacy-preserving technologies.
  • Held the PGPZ Coalition Launch Breakfast
    • June 30 Kickoff Breakfast at the Blockchain Association office

Why this matters for Zcash

PGPZ is focused on educating policymakers about Zcash, engaging with industry to respond to legislative and regulatory proposals, and taking a proactive stance towards policy development. This promotes ecosystem growth while defending against potentially harmful laws and policies by engaging with key stakeholders and helping them understand the important role Zcash and privacy play in payments.

Action Items

Help us spread awareness by inviting friends and colleagues to join the Community and Coalition.

Relevant Posts

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CLARITY Act Talks Progress, but Prospects Become Murkier

The CLARITY Act’s prospects for enactment in 2026 have become increasingly uncertain due to a compressed Senate legislative calendar ahead of the August recess. Recent developments highlight significant operational, political, and regulatory challenges that collectively decrease the likelihood of the bill becoming law this year.

The White House is actively coordinating with law enforcement agencies to resolve ongoing concerns surrounding Section 604, which relates to developer protections; authorities remain concerned that shielding developers from money-transmitter liability could inadvertently facilitate illicit financial activities, making an administrative compromise necessary for the bill’s advancement.

JPMorganChase has voiced reservations around the CLARITY Act, cautioning lawmakers against stablecoin risks and decentralized finance (DeFi) exemptions, which it says introduces substantial institutional headwinds.

And reports detailing President Trump’s substantial financial returns from digital assets have intensified congressional debate regarding potential conflicts of interest and the oversight of executive ethics within the bill.

Notably, Galaxy has reduced its odds that the CLARITY Act will pass in 2026 from 60% to 50%.

Why this matters for Zcash

The CLARITY Act generally helps the crypto industry, and the Zcash ecosystem, through a deliberate and thoughtful market structure framework that would task the CFTC with oversight over digital commodities. If this does not pass, the SEC and CFTC have released a joint taxonomy that would still protect Zcash from being treated as a security under the federal securities laws. The key piece is around the developer protections that have remained in the bill following the May Senate Banking Committee Markup. The Blockchain Regulatory Certainty Act, which protects developers who do not take custody of funds from being classified as money transmitters under the Bank Secrecy Act framework, is a crucial piece of the CLARITY Act, and without it’s passage, developers would not have a law that protects them from enforcement actions.

Action Items

Call your Senator’s office to advocate for the passage of the CLARITY Act with developer protections preserved.

Relevant Posts

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PGPZ Weekly Policy Memo: Week of July 13, 2026

A little delayed (sorry about that), here is this week’s PGPZ Community policy memo covering PGPZ Community tools, CLARITY Act stalled, and tokenized finance coordination.

Key Takeaways

  • Senior White House officials met with members of the Senate to negotiate the ethics section of the CLARITY Act.
  • Democrats have stated that they will not support the CLARITY Act without addressing ethics concerns, and this introduces scheduling constraints as the legislative calendar advances, reducing the near-term probability of a floor vote unless further amendments are included to satisfy the dissenting lawmakers.
  • The Federal Law Enforcement Officers Association (FLEOA) formally endorsed the CLARITY Act, marking the second major law enforcement endorsement following the National Organization of Black Law Enforcement Executives (NOBLE).
  • Patrick Witt, the White House’s primary liaison for the CLARITY Act, will take a leave of absence starting July 24.
  • The U.S. Department of the Treasury and the UK’s HM Treasury, working through the Transatlantic Taskforce for Markets of the Future, have released a 10-point roadmap aimed at coordinating the oversight of tokenized assets, stablecoins, and digital financial markets.

Action Items

  • Call your senators’ offices to advocate for the passage of the CLARITY Act with developer protections preserved and join the PGPZ Coalition Market Structure Working Group.

X Post of the Week

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PGPZ Community Updates

We’re excited to announce two new features of the PGPZ Community – the ZEC Shelf, a curated home for useful Zcash websites, tools, research, and references, and the X Monitor, a tool for monitoring the live conversation about Zcash on X. Enjoy!

Senate CLARITY Act Progress Stalls as Congress and Administration Discuss Ethics Provision

  • Senior White House officials met with members of the Senate to negotiate the eth-ics section of the CLARITY Act. This specific provision, which restricts the personal cryptocurrency business interests of senior government personnel, remains a primary point of contention, as Senate Democrats have consistently demanded these limits to address potential conflicts of interest. Given the limited floor time available in the Senate, the probability of the bill’s timely advancement depends heavily on achieving an adminis-trative compromise during these sessions. A failure to resolve the ethics dispute will likely delay the legislation past upcoming legislative windows.
  • Senators Chris Murphy (D-CT), Chris Van Hollen (D-MD), and Jeff Merkley (D-OR) expressed opposition to the CLARITY Act, describing the current framework as a “corrupt bill.” The senators’ pushback highlights frustration with ongoing negotiations regarding including ethics language in the final legislation. This issue complicates the bill’s path through the full Senate, where substantial bipartisan support is necessary for final passage. Democrats have stated that they will not support the legislation without addressing ethics concerns, and this introduces scheduling constraints as the legislative calendar advances, reducing the near-term probability of a floor vote unless further amendments are included to satisfy the dissenting lawmakers.
  • The Federal Law Enforcement Officers Association (FLEOA) formally endorsed the Digital Asset Market Clarity Act, marking the second major law enforcement endorsement following the National Organization of Black Law Enforcement Exec-utives (NOBLE). Notably, however, the FLEOA endorsement is conditional; the associa-tion requested specific legislative modifications to narrow liability protections for Decen-tralized Finance (DeFi) developers (Section 604), enhance accountability in DeFi sys-tems, and explicitly preserve existing federal investigative authorities. While these en-dorsements bolster the bill’s standing regarding public safety concerns, the requested amendments highlight ongoing institutional pushback against provisions perceived to hinder law enforcement capabilities. Reconciling these specific law enforcement de-mands with industry interests requires delicate administrative compromise, complicating the path to passage before the impending Senate recess.
  • Patrick Witt, the White House’s primary liaison for the Digital Asset Market Clarity Act, will take a leave of absence starting July 24 for military training. Witt has been a central figure in negotiating complex provisions of the bill, including stablecoin yield and ethics requirements, between industry representatives and lawmakers. His depar-ture occurs just weeks before a critical August 8 Senate recess deadline. Harry Jung, the Deputy Director of the President’s Council of Advisers on Digital Assets, will takeover as the lead. Jung previously served as Chief of Staff to former CFTC Commissioner Car-oline Pham and has been instrumental in the Council’s work. Why it matters for Zcash:
  • The CLARITY Act would generally help the crypto industry, and the Zcash ecosystem, through a deliberate and thoughtful market structure framework that would task the CFTC with oversight over digital commodities.
  • Over the past few weeks, the discussion has shifted from maintaining the developer pro-tections in the bill to ethics concerns. If ethics concerns are not addressed to Democrats’ satisfaction, the odds of the bill’s passage decrease given the tight margin in the Senate (53 Republicans and 47 Democrats/Independents).
  • The window for passing the CLARITY Act in the Senate is also shrinking as the Senate will recess from August 8 to September 14. If the bill is passed in September, it will need to be reconciled with the House–but the timing around this is complicated as September and October will focus heavily on elections, prior to the midterm elections in November. If the legislation does not pass, the SEC and CFTC are working on regulations that would provide more clarity for industry with respect to the application of the federal secu-rities laws.

Action Item

Call your senators’ offices to advocate for the passage of the CLARITY Act with developer protections preserved and join the PGPZ Coalition Market Structure Working Group.

Relevant Posts

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U.S., UK Move to Align Rules for Tokenized Finance Across World’s Largest Financial Markets

The U.S. Department of the Treasury and the UK’s HM Treasury, working through the Transat-lantic Taskforce for Markets of the Future, have released a 10-point roadmap aimed at coordi-nating the oversight of tokenized assets, stablecoins, and digital financial markets. Notably, these recommendations do not introduce new statutory rules; instead, they outline a framework for closer cooperation among major regulatory bodies, including the SEC, CFTC, FCA, and the Bank of England. The initiative focuses on exploring common settlement mechanisms and as-sessing whether stablecoins or tokenized funds can be utilized as collateral. While the immedi-ate probability of structural market changes is low due to the non-binding nature of the roadmap, the probability of aligned international supervisory standards and reduced cross-border regula-tory friction over the medium term is significantly enhanced.

Why it matters for Zcash: Coordination between U.S. and UK regulatory agencies signals a long-term shift toward standardized cross-border compliance frameworks that emphasize insti-tutional transparency. As these jurisdictions collaborate to integrate tokenized finance into tradi-tional market infrastructures, a key theme is to harmonize regulatory clarity to support market development for digital assets and tokenization. This could enable more clarity for digital assets, including Zcash, in the UK, and globally, as the U.S. and UK begin to collaborate on regulatory oversight.

Action Item

No action item.

Relevant Posts

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PGPZ Weekly Policy Memo: Week of July 20, 2026

Originally posted at Weekly Policy Memo: July 20, 2026 | PGPZ Community

This week’s PGPZ Community policy memo covers CLARITY Act draft released, ethics provisions challenged, and more. Join the PGPZ Community for regular Zcash related policy updates.

Key Takeaways

  • Senate Republicans released a draft of the CLARITY Act that consolidates language from the Banking and Agriculture contains a new section on ethics to satisfy Democratic concerns.
  • Senate Democrats are not satisfied with the ethics provision based on anticipated challenges with enforcement (the DOJ would be responsible for enforcing the ethics provisions against the president and other covered government officials.
  • Republican and White House opposition to direct state attorney general actions, what Democrats are pushing for, appears to be a significant constraint, although alternative mechanisms involving enforcement against intermediaries remain under discussion.
  • Patrick Witt will continue in his role as Executive Director of the President’s Council of Advisers on Digital Assets.
  • The Digital Chamber, a digital asset trade association, sued the State of Illinois over its digital-asset tax provision that will take effect next year.

Action Items

  • Call your senators’ offices to advocate for the passage of the CLARITY Act with developer protections preserved and join the PGPZ Coalition Market Structure Working Group.
  • Illinois residents should call their local state representative and senator, framing the law’s implementation as a consumer privacy and data security issue. Explain that the law forces platforms to aggressively log and track the financial data of everyday citizens to prove whether they reside in Illinois, creating a massive honeypot for hackers. Push for a legislative amendment to clearly exempt noncustodial software and peer-to-peer transfers entirely.
  • Monitor the lawsuit for any request for preliminary injunctive relief, the State of Illinois’ response, and clarification regarding the precise transactions and service providers covered by the tax. The court’s treatment of the Internet Tax Freedom Act claim will be particularly relevant to whether similar digital-asset taxes may be adopted by other states

X Post of the Week

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Senate CLARITY Act Negotiations Remain Constrained by Ethics and Scheduling Disputes

  • Senate Republicans released a draft of the Digital Asset Market Clarity Act (CLARITY Act) that consolidates language from the Banking and Agriculture Committee, containing a new section on ethics to satisfy Democratic concerns.
  • A group of Senate Democrats participating in the negotiations concluded in a joint statement that the consolidated draft does not adequately address ethics restrictions, consumer protection, illicit finance, conflicts of interest, or market integrity. Their position is significant because the Senate is expected to require 60 votes to invoke cloture, which limits debate and overcomes a filibuster so the chamber can move toward a final vote. The statement does not end negotiations, but it demonstrates that the current text lacks a reliable bipartisan coalition and therefore lowers the probability of immediate floor action.
  • Senator Cynthia Lummis (R-WY) characterized release of the consolidated draft as an important procedural milestone, while acknowledging that the text remains negotiable. Republican and White House opposition to direct state attorney general actions appears to be a significant constraint, although alternative mechanisms involving enforcement against intermediaries remain under discussion. The consolidated draft improves procedural readiness but does not establish the votes necessary for passage.
  • The White House argues that President Trump has accepted broad restrictions on the issuance or sponsorship of digital assets by senior government officials. The proposed provision would authorize civil penalties and federal enforcement, but it would principally rely on the Department of Justice. It would not provide direct enforcement authority to state attorneys general, and it would expire in January 2029, at the end of the current administration. The parties have therefore moved beyond whether an ethics provision should exist and are now disputing its enforceability and durability.
  • Relatedly, President’s Council of Advisers on Digital Assets Executive Director Patrick Witt deferred National Guard legal training so that he could continue serving as the administration’s principal negotiator during the expected Senate debate. His continued participation preserves institutional knowledge and reduces the risk of disruption at a sensitive stage. This is a modest positive development for negotiations, but it does not independently resolve disagreements over ethics enforcement, illicit finance, consumer protection, or the Senate schedule. The news comes as Harry Jung, the Council’s Deputy Director, announced he is leaving the administration.

Why this matters for Zcash

  • The CLARITY Act would generally help the crypto industry, and the Zcash ecosystem, through a deliberate and thoughtful market structure framework that would task the CFTC with oversight over digital commodities.
  • If ethics concerns are not addressed to Democrats’ satisfaction prior to August recess, the odds of the bill’s passage decrease significantly given the shrinking legislative window in August and the anticipated shift to high-priority legislative items such as funding packages. As a reminder, the timing around this vote is complicated because Congress will be heavily focused on the upcoming midterm elections in September and October.

Action Item

Call your senators’ offices to advocate for the passage of the CLARITY Act with developer protections preserved and join the PGPZ Coalition Market Structure Working Group.

Relevant Post

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Crypto Industry Group Challenges Illinois Digital Asset Tax

The Digital Chamber, a digital asset trade association, sued the State of Illinois over its digital-asset tax provision that was enacted as part of the state budget shortly before the conclusion of the legislative session. The lawsuit seeks to prevent Illinois from enforcing the tax. The Digital Chamber contends that the statute violates the uniformity and due-process clauses of the Illinois Constitution, the Commerce Clause of the U.S. Constitution, and the federal Internet Tax Freedom Act.

The complaint’s central argument is that the tax distinguishes between transactions based on the technology used to record or process them. According to the filing, the statute does not differentiate between profitable and unprofitable transactions, realized and unrealized gains, or transfers that do and do not change ownership. Instead, it allegedly distinguishes between traditional financial infrastructure and blockchain infrastructure.

The Digital Chamber further argues that this distinction conflicts with the Internet Tax Freedom Act, which limits discriminatory state and local taxation of electronic commerce. The complaint maintains that federal law generally distinguishes assets according to their legal or economic characteristics rather than the technology used to record ownership.

Why this matters for Zcash

  • This law affects Zcash users in Illinois who use centralized platforms like Coinbase, Kraken, and Gemini, as the platforms will be required to log every purchase, trade, or withdrawal of crypto, including Zcash, and tack on the 0.2% tax, including transfers from a custodial wallet to a noncustodial wallet.
  • The law may impact users who use a noncustodial wallet’s internal swap functions, which rely on decentralized backend partners. While peer-to-peer transactions via noncustodial wallets would not be subject to the tax, the external liquidity providers, DeFi frontends, and market makers that execute the cross-chain swaps would likely be operating for-profit businesses because they collect fees. If these underlying protocols clear $100,000 in gross receipts from crypto trades originating in Illinois, the state will consider them “brokers.” This may result in companies blocking Illinois residents or limiting available features via geofencing.

Action Items

  • If you are in Illinois, call your local state representative and senator, framing the law’s implementation as a consumer privacy and data security issue. Explain that the law forces platforms to aggressively log and track the financial data of everyday citizens to prove whether they reside in Illinois, creating a massive honeypot for hackers. Push for a legislative amendment to clearly exempt noncustodial software and peer-to-peer transfers entirely.
  • Monitor the case for any request for preliminary injunctive relief, the State of Illinois’ response, and clarification regarding the precise transactions and service providers covered by the tax. The court’s treatment of the Internet Tax Freedom Act claim will be particularly relevant to whether similar digital-asset taxes may be adopted by other states.

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Hey Paul, I noticed something on the PGPZ community site while going through signup on mobile. Is there a support channel or someone I should message directly about it?

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Weekly Policy Memo: Week of July 27, 2026

Originally posted at: Weekly Policy Memo: July 27, 2026 | PGPZ Community

This week’s PGPZ Community policy memo covers PGPZ July Monthly Update, Statements on state activity, PGPZ CLARITY Act Coalition Letter, and CLARITY Act Updates.

Key Takeaways

  • July marked PGPZ’s transition from initial organizational development toward sustained public education, policy monitoring, and direct advocacy. PGPZ expanded that foundation through new community resources and interventions concerning federal market structure, financial-crime oversight, state taxation, and electricity policy.
  • Senators Thom Tillis (R-NC) and Ruben Gallego (D-AZ) submitted revised CLARITY Act ethics provisions to the White House.
  • Banking interests are seeking a stronger prohibition on stablecoin yield-like products, while cryptocurrency companies oppose restrictions that could encompass rewards programs. This dispute adds uncertainty to the coalition needed to begin and complete floor consideration.

Action Items

  • Help us spread awareness by inviting friends and colleagues to join the Community and Coalition.
  • We’re in the home stretch! Call your senators’ offices to advocate for the passage of the CLARITY Act with developer protections preserved and join the PGPZ Coalition Market Structure Working Group.

X Post of the Week

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July Monthly Update on PGPZ

July marked PGPZ’s transition from initial organizational development toward sustained public education, policy monitoring, and direct advocacy. PGPZ expanded that foundation through new community resources and interventions concerning federal market structure, financial-crime oversight, state taxation, and electricity policy.

PGPZ launched or substantially updated four public-facing resources:

ZEC Shelf: A centralized collection of educational and policy resources, including materials explaining how Zcash works. The feature is intended to make reliable background information easier for community members, policymakers, and external stakeholders to locate.

X Monitor: A monitoring tool through which Community and Coalition members can follow Zcash-related posts on X and identify emerging policy discussions, misconceptions, and opportunities for engagement.

Topic Briefings: FAQ-style collections of curated questions and answers intended to provide accessible and consistent explanations of recurring Zcash and public-policy issues.

Community Page Refresh: The PGPZ Community homepage was updated to improve access to policy materials, monitoring tools, briefings, and opportunities for participation.

These developments principally improve PGPZ’s organizational and communications capacity. They do not themselves change public policy, but they provide infrastructure for faster issue identification, more consistent public explanations, and more informed participation by Community and Coalition members.

We prepared and published statements for the record in connection with the House Financial Services July 17 CLARITY Act hearing and the July 21 FinCEN oversight hearing. The submissions represent a step beyond general policy commentary by directing Zcash-specific perspectives toward formal congressional oversight and legislative discussions.

PGPZ and participants from across the Zcash ecosystem prepared for submission a coalition letter to Senate Majority Leader John Thune and Democratic Leader Charles Schumer supporting H.R. 3633, the Digital Asset Market Clarity Act of 2025. The letter urged the Senate to bring the legislation to the floor while preserving its treatment of network tokens and the developer protections contained in the Blockchain Regulatory Certainty Act.

We issued a statement opposing the Illinois Digital Asset Tax Act enacted as part of the state’s fiscal year 2027 budget legislation. According to the statement, the Act taxes covered exchanges, transfers, and storage activity based on the value of the digital assets involved rather than on whether a user realizes income or profit. PGPZ argued that the structure could apply repeatedly across related activities, including a transfer from a custodial platform to a noncustodial wallet.

We also published a statement opposing a one-size-fits-all approach to large electricity loads in Texas. The statement addressed Texas Senate Bill 6, related Public Utility Commission of Texas proceedings, and a proposed change to the state’s transmission-cost methodology and large-load tariffs. It argued that these policies should distinguish between conventional data centers and cryptocurrency-mining facilities capable of rapid and reliable curtailment.

Why this matters for Zcash

July’s work expanded PGPZ’s ability to address several distinct policy channels affecting the Zcash ecosystem.

  • The website updates provide practical infrastructure for educating policymakers and community members, identifying emerging narratives, and coordinating accurate responses. These tools may be particularly useful when questions involve technically complex subjects such as shielded transactions, selective disclosure, viewing keys, self-custody, developer control, or proof-of-work mining.
  • The Statements and Coalition letter demonstrate PGPZ’s advocacy efforts to share the Zcash ecosystem’s perspectives and provide recommendations to federal and state government organizations to achieve their objectives while supporting financial privacy and Zcash stakeholders.
  • Collectively, these developments show a progression from the institution-building described in the June memo toward direct advocacy, ecosystem coordination, and production of reusable policy resources. They do not establish favorable legislative or regulatory outcomes, but they improve PGPZ’s capacity to participate in the proceedings that will determine those outcomes.

Action Item

Help us spread awareness by inviting friends and colleagues to join the Community and Coalition.

Senate CLARITY Act Negotiations Continue as Congress Tackles Remaining Issues

  • Senators Thom Tillis (R-NC) and Ruben Gallego (D-AZ) submitted revised ethics provisions to the White House. The proposal would change the enforcement mechanism for a prohibition on federal officials issuing or sponsoring tokens by allowing state authorities, rather than the U.S. Attorney General, to enforce the restriction, though this mechanism has yet to be revealed publicly. The bipartisan counteroffer modestly improves the possibility of resolving a significant objection raised by Senate Democrats, but there is no reported confirmation that the White House accepted it, that the language has been finalized, or that it secured additional votes.
  • Banking interests are seeking a stronger prohibition on stablecoin yield-like products, while cryptocurrency companies oppose restrictions that could encompass rewards programs. A bank-supported amendment that did not receive a committee vote could potentially be raised on the Senate floor. This dispute adds uncertainty to the coalition needed to begin and complete floor consideration.

Why this matters for Zcash

  • For Zcash, the principal significance is whether resolution of the ethics dispute permits the CLARITY Act to advance. If the dispute remains unresolved, the Senate may not reach substantive provisions that could affect ZEC, exchanges, developers, wallets, or other ecosystem participants. The enforcement design may also affect the political durability of the overall package. If lawmakers consider the ethics mechanism credible, more senators may be willing to support the bill. If they consider state enforcement insufficient, fragmented, or legally uncertain, the proposal may fail to resolve the underlying objection. The supplied sources do not establish which assessment is more likely to prevail.
  • The practical effect is consequently procedural rather than operational. A successful compromise could remove one barrier to Senate consideration of legislation that may ultimately affect Zcash. It does not itself change the legal treatment of ZEC or the operation of the Zcash protocol.

Action Item

We’re in the home stretch! Call your senators’ offices to advocate for the passage of the CLARITY Act with developer protections preserved and join the PGPZ Coalition Market Structure Working Group.

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