The CLARITY Act, which is intended to provide regulatory clarity to the crypto industry, has been working its way through Congress for the past couple of years, but Duke University lecturing fellow Lee Reiners, who previously worked as a bank examiner at the New York Federal Reserve, says the new law would remove securities regulation protections for consumers from crypto tokens such as the Trump-affiliated World Liberty Financial’s WLFI token. The claim was made in a new blog post published by Reiners on Friday where he also claimed that WLFI is an unregistered security as it exists today and the SEC lacks the integrity needed to enforce the law. Reiners builds his case that WLFI functions as an unregistered security by applying the Howey test, a legal framework established by the Supreme Court in 1946. Under that test, an investment contract qualifies as a security when it involves an investment of money in a common enterprise with a reasonable expectation of profits derived primarily from the efforts of others. He walks through each element with evidence drawn from World Liberty Financial’s Gold Paper whitepaper, token sales data, marketing materials, and operational decisions. Some of the supporting evidence Reiners pointed to when making his case include: World Liberty Financial sold WLFI tokens to raise capital for the development of the WLF Protocol, Trump family-affiliated entities hold equity stakes in the parent company and receive a large share of net revenues, WLFI token buyers had a reasonable expectation of profits based on marketing materials that emphasized future growth, and World Liberty Financial has retained centralized control through a Delaware nonstock corporation structure and various technical mechanisms such as manual upgrades via multisig wallets and the freezing of tokens.