Trump's Crypto Holdings Could Secure Him Billions in Tax Savings

A bipartisan bill in Congress aims to regulate the crypto industry through the Clarity Act. However, its ethics provision could inadvertently grant President Donald Trump a massive tax break if he's forced to sell his crypto holdings.

The draft provision requires Trump to divest assets tied to crypto businesses, allowing him to defer federal capital-gains taxes on profits for years or even permanently. This is because current tax law permits the deferral of taxes on gains from a forced sale if the proceeds are reinvested in new investment assets.

Trump's reported $1.4 billion income in 2025 from crypto- and memecoin-related businesses would be subject to a 20% federal capital-gains tax if he weren't allowed to defer it. The ethics provision was jointly drafted by Republican Senator Thom Tillis of North Carolina and Democratic Senator Ruben Gallego of Arizona, but its details remain confidential.

This development has sparked concerns about the potential for Trump's crypto assets to be treated differently than those held by other senior officials. Commerce Secretary Howard Lutnick and Treasury Secretary Scott Bessent have already used special tax provisions available to senior government officials to defer capital-gains taxes when selling assets.