Senate Crypto Rule Fails to Address Family Ties

The CLARITY Act aimed to regulate crypto markets and establish who regulates them. The Senate draft included a provision that would have required senior federal officials, their spouses, and officials subject to public financial-disclosure rules to sell or place into a qualified blind trust any equity interests worth at least $15,000 in businesses issuing or sponsoring digital assets.

The rule wouldn't have applied to adult children of these officials. This distinction became a point of contention among Democrats, who argued that it didn't go far enough to prevent conflicts of interest.

Congressman Howard Lutnick's situation illustrates the issue. He stepped down from Cantor Fitzgerald, his company involved with Tether, and transferred control to trusts benefiting his adult children. While this created a legal separation between him and the business, the family remains economically tied to it.