The U.S. Senate has just released an updated draft of the Digital Asset Market Clarity Act, merging language from the Senate Banking and Agriculture Committees. However, the path to passage has hit a major roadblock. The new draft inserts ethics provisions barring senior government officials from issuing or sponsoring their own cryptocurrencies - a direct response to Donald Trump, who made over $1.4 billion from digital assets last year.
Why Democrats Are Rejecting the Ethics Deal
The current version of the ethics rules has already been approved by the White House, featuring a clause that gives Trump one year to divest or place his businesses into a blind trust, with enforcement left to the Department of Justice (DOJ). But Democrats are rejecting this compromise.
They do not believe the DOJ will take action against Trump while he remains in office. Democrats also highlighted that these ethics provisions are designed to sunset once the next president is inaugurated. The loophole triggering the fiercest opposition is the name-image-likeness clause, which allows Trump to continue profiting from tokens bearing his name. The $1.4 billion crypto earnings figure from last year has now officially become key ammunition for Democrats heading into the midterm elections.
Senator Elizabeth Warren voiced sharp criticism, calling for the bill to be rejected outright due to investor protection and national security concerns. The pushback is not limited to a single party; a report from Punchbowl News noted that several Republican lawmakers also object to the current text.
A Two-Week Deadline
Outside the Capitol, the majority of the crypto industry is urging swift passage of the bill, arguing it promises regulatory clarity and investor protections. However, the remaining legislative window is rapidly narrowing.
For the bill to advance, a motion to proceed must be filed this Monday or Tuesday. Both sides must then reach a final agreement on the ethics provisions no later than Thursday, July 30. If it stays on schedule, a cloture vote would likely take place during the week of August 3, racing against the Senate recess deadline on August 7.
The remaining time could ultimately determine the fate of the CLARITY Act. Kristin Smith of the Solana Policy Institute noted that recess deadlines are a powerful forcing mechanism in politics. The fight has now turned into a battle of nerves: strike a compromise within the next two weeks, or let the bill stall as senators pack their bags.
Reported by CoinDesk.
Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
