The long-awaited Clarity Act has been stalled in Congress since January, primarily due to disagreements related to stablecoin rewards. People involved in negotiations on the crypto bill have said throughout the month that progress is increasing, with May potentially being a turning point in the Senate.
However, a recent Politico report Suggests that the biggest hurdle may no longer be the inclusion of stablecoin-specific language. Instead, Democrats are vowing to block progress until there is bipartisan agreement on ethics provisions, particularly restrictions aimed at preventing Trump from engaging in crypto activity.
clarity act intersection
Senator Ruben Gallego, a Democrat who supports the overall legislation and has worked on the ethics negotiations, summarized the advantage Democrats are using. As he said, “there is no final bill” and “no final movement” until the ethics issue is agreed upon in a bipartisan manner.
The debate over the ethics of the Clarity Act has become more urgent as the Trump family’s crypto businesses are at the center of growing frustration among lawmakers on the left.
Those businesses have been described as representing more than $1 billion of the family’s wealth, and critics argue that “a light regulatory regime” for the digital asset industry could enrich the first family.
The White House has repeatedly said the president has no conflicts of interest. Senate Republicans have also largely defended him against attacks involving his family’s crypto holdings. Still, both sides understand that a compromise is necessary to clear the way for the bill.
According to the report, there is a shared awareness that if Republicans lose either house of Congress, it will be much harder to achieve a long-standing industry initiative to reorganize oversight to divide responsibilities for crypto trading among Wall Street regulators.
At this point, it’s still uncertain whether Democrats can secure an arrangement that both Senate Republicans and the White House accept — especially one that would meaningfully limit the Trump family’s crypto trading involvement.
The battle of morality became the last big obstacle
Another complication is the legislative process itself. Republicans on the Senate Banking Committee have said they intend to advance the Clarity Act in the coming weeks, but have described the ethics fight as one of the last outstanding issues needed for the bill to gain broad bipartisan support.
Because ethics policy is outside the jurisdiction of the Banking Committee, the Committee is not expected to include ethics language in the Clarity Act markup.
Still, Gallego said there needs to be clarity before the crypto bill reaches the floor — specifically, a “clear explanation” of how ethics provisions will be handled and included by the time of markup.
Featured image from OpenArt, chart from tradingview.com
editorial process Focused on delivering thoroughly researched, accurate and unbiased content for Bitcoinist. We adhere to strict sourcing standards, and each page undergoes diligent review by our team of top technology experts and experienced editors. This process ensures the integrity, relevance and value of our content to our readers.
