Senate Republicans Finalize Clarity Act Amid Ethics Concerns

Senate Republicans have released the final text for the Digital Asset Market Clarity Act, which aims to set out a regulatory framework for digital assets. The bill passed the US House of Representatives in July 2025 and would treat commodity exchanges as financial institutions, granting the Commodity Futures Trading Commission primary regulatory oversight over cryptocurrencies.

The new draft adds ethics language and protections for banks against deposit flight, which has been a point of contention among senators and banking institutions. Specifically, the provision that would provide holders of stablecoins with rewards such as interest payments could cause deposit flight as savers move their funds away from lenders, according to Republican senators.

The final text proposes new powers for the Secretary of the Treasury to restrict rewards or incentives available to stablecoin holders if they determine that community banks face a 'substantial detrimental impact' driven by deposit flows. Ethics provisions have also been strengthened, requiring 'covered individuals,' including those in public office and their spouses, to divest 'significant' crypto assets or place them in a blind trust.

Critics argue that the updated text does not go far enough, with staff for Massachusetts Senator Elizabeth Warren describing the final ethics text as 'empty.' The Senate will vote on the act on 15 September, and supporters must secure at least seven Democratic or independent votes to pass the bill.