President Donald Trump's disclosure of $1.4 billion in crypto-related earnings has become the central obstacle to passing the Digital Asset Market Clarity Act, as Senate Democrats demand ethics provisions that would restrict presidential crypto holdings before they will supply the votes needed to clear the 60-vote threshold.
President Donald Trump's disclosure that the crypto sector added $1.4 billion to his personal wealth has become the central obstacle to passing the Digital Asset Market Clarity Act, with Senate Democrats demanding ethics provisions targeting presidential crypto holdings before they will supply the votes needed to clear the 60-vote threshold.
"Public cynicism is very high, especially at the federal level," Andrew Cuomo, the former New York governor, said in a July 7 Bloomberg TV interview. "I would hope they build in full disclosure and clear ethics guidelines so the public knows they're not benefiting themselves by their actions."
A new draft of the Clarity Act is expected to circulate this week, combining versions previously passed by the Senate Banking and Agriculture committees with roughly 70 additional pages, according to individuals familiar with the negotiations. But the text is not expected to include completed language on the ethics provision or agreements on several other contentious issues, meaning the bill remains unready for a floor vote.
The ethics impasse centers on whether the legislation should ban presidents and senior government officials from issuing or profiting from digital assets. Trump's largest single 2025 income stream — $636 million from the Official Trump memecoin — has become a flashpoint. Senator Kirsten Gillibrand, a New York Democrat involved in the discussions, said she and fellow Democrats are pushing to make it illegal for presidents to issue or sponsor any digital assets.
"We cannot let self-dealing destroy an opportunity to strengthen consumer protections, crack down on illicit finance and expand economic opportunity for the millions of Americans our financial system has left behind," Gillibrand said in a statement. "The time to act is now — and that must include ethics reforms that prohibit members of Congress, the president and their spouses from cashing in on their office."
The 60-vote math and the calendar crunch
Senate Majority Leader John Thune has signaled he is willing to bring the Clarity Act to the floor in July, with rumors pointing to the weeks of July 20 or July 27. But with the Senate facing its summer recess and the Nov. 3 midterm elections approaching, the legislative window is narrowing rapidly. To pass, the bill needs at least seven Democrats to join Republicans — more if any GOP senators vote against it or are absent.
On Monday, Senators Chris Murphy, Chris Van Hollen and Jeff Merkley announced they would hold a press conference this week to state their opposition to Clarity, which they said represents a "failure to rein in President Donald Trump's corrupt crypto schemes." In a briefing of Senate Democratic offices last week, ethics advocates rounded up by Murphy argued that the ethics section must extend to officials' family members and include both ownership bans and disclosure rules, according to a person familiar with the discussion.
David Nage, portfolio manager at Arca, said last month that Senate Democrats are unlikely to provide the votes necessary to clear the 60-vote threshold without stronger ethics safeguards. The White House has signaled it might accept ethics provisions as long as they apply broadly to all officials and do not specifically target the president and vice president.
Trump himself has publicly endorsed the Clarity Act. After news emerged that his staunch Senate ally Lindsey Graham had died suddenly, Trump posted on his social media platform that the bill should be passed in his honor. Senator Cynthia Lummis, the Wyoming Republican who leads the Senate Banking Committee's digital assets subcommittee, echoed the call.
White House crypto advisor Patrick Witt called this a "critical week" for the Clarity Act in a post on X, noting that it falls on the one-year anniversary of the industry's first major stablecoin regulation bill. "A reminder of the incredible amount of hard work that has gone into this bill, but also of the time we've already lost," Witt said.
One complication has already been resolved: a provision banning the Federal Reserve from issuing a central bank digital currency for at least four years took effect over the weekend as part of the housing affordability bill Trump signed into law. Industry players had feared House lawmakers might try to attach a CBDC ban to Clarity, which would have further strained negotiations. That issue is now settled through at least 2030.
If the Clarity Act fails to advance, the U.S. crypto industry faces continued regulatory uncertainty through the midterm elections and potentially into 2027. If it passes without an ethics provision, it risks a fractured vote that could undermine its legitimacy and invite legal challenges. The next few days will determine whether a compromise can be reached — or whether the bill becomes another casualty of election-year politics.
This article is for informational purposes only and does not constitute investment advice.
