Trump's Crypto Holdings Cast Shadow Over Senate Vote on CLARITY Act

The fate of the CLARITY Act, a bill aimed at clarifying digital asset regulations, hangs in the balance as the Senate prepares to vote on a procedural motion. The bill has already passed the House with a bipartisan majority, but its chances in the Senate are uncertain due to a dispute over ethics language.

The conflict of interest created by President Trump's estimated $1.4 billion in crypto assets is at the heart of the issue. Democrats have declined to provide their votes for the bill unless it includes stronger ethics enforcement, specifically language that would reach Trump's existing World Liberty Financial income.

The current text of the CLARITY Act bars sitting federal officials and their spouses from issuing or sponsoring new digital assets while in office, but permits existing holdings. It also expires in 2029, a year before Trump is required to leave office regardless. Democrats have pushed for language broad enough to cover Trump's existing income.

Coinbase CEO Brian Armstrong has expressed confidence that the bill will pass the procedural hurdle, but his company has a vested interest in its passage due to Section 412 of the current text, which would prohibit stablecoins from paying yield or rewards. This provision would eliminate approximately $1.35 billion in annual revenue for Coinbase.