Clarity Act stalls as Congress breaks for summer; ethics fight heats up
In brief
- Clarity Act missed July 4 deadline despite White House adviser Patrick Witt's May optimism
- Three sources say lawmakers remain optimistic about 2026 passage despite narrowing window
- Trump's $1.4 billion crypto earnings from $2B total 2025 income sparked ethics concerns
- Senate Democrats push ethics provisions blocking president, VP, and Congress from crypto profits
- Senate needs only days to debate and vote if bill reaches the floor
The timeline crunch
Three people tracking the Clarity Act process said late last week they were still optimistic about the bill's chances of passage in 2026. But optimism alone won't move legislation through a summer recess. Congressional staffers were still meeting to hash out issues, including reconciling the Senate Agriculture Committee and Senate Banking Committee versions of the bill. The clock ticks fast. If the Clarity Act doesn't pass before the midterm election, prospects become uncertain, with less chance of passage if the House or Senate flips.
The good news: the Senate only needs to be in session for a few days to publicly debate the bill and vote on it. But "a few days" requires political will—and right now, Democrats are demanding something the bill may not yet include.
Trump's crypto windfall sparks ethics fight
President Donald Trump disclosed making $2 billion in 2025, with approximately $1.4 billion coming from the crypto industry. The income came from royalty payments from his memecoin company, token sales from World Liberty Financial, and sales to an Abu Dhabi sheikh's firm. He also disclosed holding over $100 million in various cryptocurrencies and smaller stakes in firms like Corewave.
The disclosure landed like a grenade on Capitol Hill. Senator Elizabeth Warren called for an ethics provision in the Clarity Act to prevent the president, vice president, senior administration officials, members of Congress and their families from profiting off the crypto industry.
"The crypto legislation heading to the Senate floor must prevent the president, vice president, senior administration officials, members of Congress and their families from profiting off the crypto industry. If it does not, it will only turbocharge Donald Trump's brazen crypto corruption." — Senator Elizabeth Warren
The Democratic split
Not all Democrats oppose the bill outright. Senator Ruben Gallego was one of two Democrats to vote the bill out of committee, yet he's now signaling that ethics safeguards matter. He said during the May markup hearing that the bill needed real, enforceable standards on ethics. Senator Angela Alsobrooks was the only other Democrat to vote for the bill in committee.
Gallego's position is delicate. He's willing to support crypto regulation, but not one that lets Trump—or any sitting official—turn regulatory clarity into personal profit. That stance may now define the final weeks before the Senate votes, if it votes at all.
