Ethics Detour: Trump's Crypto Bill Takes the Senate on a Four-Week Cliffhanger 🏛️

President Donald Trump has agreed to an ethics provision in the Digital Asset Market Clarity (CLARITY) Act, removing the major hurdle blocking the crypto market structure bill from advancing to a Senate vote. The provision would restrict presidents, vice presidents, members of Congress and other federal officials from profiting from digital assets while in office. According to Punchbowl News, the White House, Senator Cynthia Lummis, and Senator Bernie Moreno reached an agreement on the language, which has been sent to certain Senate Republicans. Trump approved the proposal late Monday, according to industry sources. Lummis said on Fox Business that a revised bill text would be introduced within days and could reach the Senate floor next week. Former CFTC Commissioner Summer Mersinger, now CEO of the Blockchain Association, told the Thinking Crypto podcast that lawmakers are merging the Senate Banking Committee and Senate Agriculture Committee versions into a single proposal and expect a floor vote "probably early next week." "We're at the one-yard line right now. I feel like we can get it across the finish line," Mersinger said. Senate Majority Leader John Thune said in an X post that there is "a good chance" lawmakers reach a bipartisan deal, while warning it could still change. "We were currently working with Democrats to get to a place where Democrats can help deliver the votes we need to get the bill on the floor, but that I am optimistic about it," Thune wrote. Senator Thom Tillis, who has been helping work through unresolved provisions, told Politico, "I'm hoping that we can come up with some agreement by the end of this week. I think it's critical if we're going to try and get this across the floor before August recess."

Earlier, Trump had urged the Senate to pass the bill on Truth Social "in honor of" Senator Lindsey Graham, a South Carolina Republican who died at age 71 over the weekend. "China, and many other countries, would like to take complete and total control of this major financial 'happening,' as well as A.I., where we are now leading, but where they are fighting hard. Don't let China win on either subject!!!" Trump wrote. The Senate has roughly four weeks of session before an August recess beginning August 8, widely viewed as the bill's last realistic chance this year. If the bill fails to pass, Lummis has warned that market structure legislation could slip to 2030 or die entirely at the end of the 119th Congress in January 2027, forcing a full restart. With Graham's death and Senator Mitch McConnell hospitalized, Republicans' majority has been reduced to 51-47, requiring Democratic support to meet the 60-vote cloture threshold. The CLARITY Act passed the House 294-134 on July 17, 2025, and cleared the Senate Banking Committee 15-9 on May 14, 2026. It would shift much of the authority for enforcing digital asset oversight from the SEC to the CFTC. Ripple Chief Legal Officer Stuart Alderoty urged lawmakers to vote in favor, warning, "We've seen this movie. Let's not watch the sequel," in reference to the FTX collapse.

The ethics fight intensified after Trump's financial disclosure showed he earned more than $1 billion from crypto in 2025, including over $500 million from his family's World Liberty Financial venture. A group of Democratic senators held a press conference Tuesday calling for opposition to the bill if it does not sever Trump's "corrupt" ties to the sector. Prediction market traders remain skeptical despite the latest deal. Polymarket put the odds of the CLARITY Act being signed into law this year at 39% as of July 17, while Kalshi gave it a 36% chance of becoming law in 2026 on a $3 million market, and a 62% chance before the end of 2027. Kalshi traders priced a 79% chance the bill gets voted on by the Senate before the August recess, up from 68.8% the previous day. Galaxy Digital Head of Research Alex Thorn cut his firm's passage odds to 50%, citing a shrinking calendar and competition for floor time. Solana Policy Institute President Kristin Smith was more optimistic, citing building momentum and the emerging bill text. White House crypto advisor Patrick Witt described the week as critical for the bill. The CLARITY Act would build on the GENIUS Act, the first major U.S. crypto law, which Trump signed last July.