Senate Democrats reject Trump ethics provision in Clarity Act
In brief
- GOP-White House ethics deal on Trump crypto profits rejected by Democrats over enforcement concerns.
- Ethics rules would prohibit senior federal officials, including the president, from issuing digital assets in office.
- Sen. Gallego and Sen. Tillis drafting counterproposal to resolve state attorney general enforcement authority disputes.
White House Proposal Stalls on Enforcement
GOP Senators struck a deal with the White House on ethics language tied to Trump's crypto profits. The proposal would bar senior federal officials, including the president, from issuing or sponsoring digital assets while in office. But Democrats rejected ethics language backed by the White House, prompting bipartisan negotiations on a revised proposal.
The sticking point: the ethics provisions give the Department of Justice exclusive authority to enforce the ethics rules. Democrats said they cannot support language that leaves enforcement exclusively to the DOJ. Sen. Ruben Gallego described the proposal as inadequate after months of bipartisan negotiations. He said negotiations broke down over whether state attorneys general should have enforcement authority.
Competing Visions on Oversight
The ethics language was crafted through discussions between the White House and Republican Sens. Cynthia Lummis and Bernie Moreno. Sen. Cynthia Lummis praised the proposal, saying Trump is voluntarily embracing ethics standards that exceed existing legal requirements.
Gallego is working alongside Sen. Thom Tillis and other unnamed Republican senators to draft a counterproposal. Sen. Thom Tillis said the White House-backed proposal was a positive starting point but acknowledged that additional changes would likely be needed.
Timeline Slips as Negotiations Continue
The delays are real. Senate Majority Leader John Thune said he no longer expects the chamber to pass the bill before the August recess. Still, Thune hopes to at least begin debate on the Clarity Act measure before lawmakers adjourn. The Clarity Act remains a priority for crypto regulation, but the ethics provisions have become a flashpoint in otherwise bipartisan efforts to clarify digital-asset oversight.
Frequently asked questions
What do the Clarity Act ethics rules require?
The ethics provisions would bar senior federal officials, including the president, from issuing or sponsoring digital assets while in office. The Department of Justice would have exclusive enforcement authority under the White House proposal.
Why did Democrats reject the White House proposal?
Democrats said they cannot support language that leaves enforcement exclusively to the DOJ. Negotiations broke down over whether state attorneys general should also have enforcement authority.
Who is drafting the counterproposal?
Sen. Ruben Gallego is working alongside Sen. Thom Tillis and other unnamed Republican senators to draft a counterproposal to address enforcement concerns.
