Trump's Crypto Ethics Concessions Fail to Save CLARITY Act
Despite Trump's agreement to unprecedented ethics concessions, the CLARITY Act failed in the Senate by a vote of 49-50. The White House crypto adviser, Patrick Witt, revealed that President Donald Trump had agreed to strict limits on his crypto activities, including requirements for divestment or blind trusts, and provisions allowing state attorneys general to enforce certain ethics rules.
The concessions were made during negotiations over the CLARITY Act, which aimed to establish a federal framework for digital assets. However, the bill collapsed due to unresolved disputes on stablecoin rewards, DeFi rules, illicit finance protections, and enforcement powers.
Negotiators were divided over stablecoin rewards, with banks opposing certain structures that could encourage customers to move deposits away from traditional financial institutions. The CFTC has since submitted a crypto market regulatory action for White House review, while the SEC has moved forward with temporary relief covering certain forms of on-chain trading of tokenized securities.
The Senate's defeat leaves the industry without a comprehensive market structure framework, but Republican Sen. Thom Tillis filed a motion to reconsider, leaving the door open for another vote if negotiators can secure enough support.