Ethics Rule Gives Trump's Crypto a 2029 Sunset — Senate Dems Want a Bigger Shade 🏛️

Bipartisan negotiators on the Digital Asset Market Clarity (CLARITY) Act convened on Capitol Hill on Tuesday to resolve the legislation's remaining sticking point: an ethics provision barring federal officials, including President Donald Trump, the vice president and members of Congress, from issuing or sponsoring digital assets. Crypto journalist Eleanor Terrett reported on X that "Bipartisan discussions are taking place on Capitol Hill today relating to ethics, I'm told," adding that "negotiators are also discussing DeFi provisions, but ethics remains the primary hurdle." A spokesperson for Senator Cynthia Lummis said last week's White House meeting "went well" and that "the ethics text set to release in the coming days will reflect that productive conversation."

The 616-page draft circulated Wednesday to crypto industry insiders would require covered officials and their spouses to divest crypto holdings or place them in a blind trust, prohibit them from issuing or sponsoring crypto assets, and bar platforms from listing such assets. The provision would sunset on January 20, 2029, the end of Trump's current term, and would leave enforcement to the U.S. Attorney General rather than state attorneys general. The text does not extend restrictions to the children of public officials; all three of Trump's sons are co-founders of World Liberty Financial, and Don Jr. and Eric Trump launched Bitcoin ($BTC) mining firm American Bitcoin. Financial disclosures released last month showed Trump earned more than $1.2 billion from crypto businesses in 2025, with Senator Lummis later citing figures of more than $1.4 billion in 2025. Digital Chamber CEO Cody Carbone called the draft "a meaningful step toward the Senate vote on the Clarity Act we've been calling for."

Senate Democrats have signaled reservations. Senator Angela Alsobrooks told Politico on Tuesday, "I wouldn't support the bill if that's the language," adding, "But we'll keep working from that floor to reach an agreement that holds us all accountable." Progressive groups including Indivisible and Demand Progress sent a letter to every Democratic Senate office criticizing Senator Kirsten Gillibrand's role in negotiations, citing concerns over her crypto ties and her son's crypto venture. Senator Elizabeth Warren has demanded the bill bar the president, vice president, senior officials, members of Congress and their families from profiting off the sector. The bill needs at least 10 Democrats to clear the chamber's 60-vote threshold, with Senate Majority Leader John Thune reportedly planning a floor vote as soon as next week and a final deadline of August 7 before the Senate's summer recess.

The draft also preserves the Blockchain Regulatory Certainty Act, creating a safe harbor that classifies non-custodial software developers as non-money transmitters, a provision many in the industry consider a red line following Trump-era DOJ prosecutions of developers who built privacy tools. Democratic lawmakers had not yet seen the draft text when it was posted at Punchbowl News on Wednesday, and Senator Lummis issued a statement thanking Democrats for their contributions while pledging "my commitment to reaching a deal in the coming days that will allow this legislation to become law."