Overview
On Wednesday, Republicans unveiled a revised version of the Clarity Act, which features an ethics clause that prohibits public officials from issuing or endorsing cryptocurrencies. However, analysts have already raised concerns regarding the adequacy of this language in preventing President Donald Trump from gaining financially from crypto ventures.
According to ethics disclosures, Trump reportedly earned around $1.4 billion from cryptocurrencies last year.
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Essential Information
A latest draft of the over 600-page Clarity Act, sourced by various media outlets, proposes new ethical guidelines for public officials concerning cryptocurrency. Specifically, it prohibits such officials and their spouses or employees from issuing or promoting any “digital asset” while in office.
Nevertheless, the draft does not restrict officials’ children or other relatives from engaging in the issuance or promotion of digital assets, potentially allowing Trump’s immediate family to benefit from crypto transactions.
This proposal also aims to prevent companies from listing any digital assets created or promoted by public officials, while requiring politicians to either place their existing crypto assets into a blind trust or divest them during their time in office. Critics argue that these provisions might not effectively inhibit Trump from making profits through crypto dealings, which are estimated to have brought him approximately $1.4 billion last year.
The White House has previously stated that Trump would be open to signing a bill that includes the Republican-driven ethics provision, referring to it in a statement to CoinDesk as “the most extensive ethics provision in history.”
However, the bill assigns the attorney general the role of enforcing these ethical guidelines while prohibiting state attorneys general from doing so, prompting congressional Democrats to express reluctance about allowing the current Justice Department to handle enforcement.
Additionally, the ethics provision is set to expire in 2029—specifically, on January 20, 2029, which is the inauguration date for the successor to Trump.
Noteworthy Detail
The ethics guidelines state that public officials are barred from utilizing their name, likeness, or official capacity in the promotion of digital assets. However, there is a provision that permits the use of a public official’s likeness for assets issued prior to taking office. Trump introduced his memecoin, $TRUMP, just three days before assuming the presidency. According to Forbes, previous estimates suggest he earned around $635 million from that coin in 2025 and approximately $800 million through the crypto firm World Liberty Financial. Trump and his family hold a approximately 40% stake in the company, which issues its own cryptocurrency token. The firm has previously generated about $57.4 million for Trump the year prior.
Significant Statements
Sen. Angela Alsobrooks, D-Md., one of the Democrats who supported the bill’s advancement in committee this year, expressed her opposition to the current draft. At a Semafor conference on Wednesday, she criticized handing enforcement authority to the Justice Department as “ridiculous and impractical,” stating, “It’s unrealistic to rely solely on the DOJ given their history of negligence in law enforcement.” Instead, she recommended empowering state attorneys general to oversee compliance with the rules. Later that day, Alsobrooks was among seven Senate Democrats who issued a statement asserting that the current Clarity Act draft “is lacking,” particularly pointing to the ethics provisions as a major issue.
Leading Critic
Sen. Elizabeth Warren, D-Mass., who serves as the ranking member on the Senate Banking, Housing, and Urban Affairs Committee, criticized the Republicans’ draft, claiming it “fails to take any meaningful action” to restrict Trump from continuing to profit from cryptocurrencies. A statement from her office claimed that the new draft is “full of significant loopholes” and would allow Trump to continue earning through World Liberty Financial.
Counterpoint
In defense of the draft, Sen. Cynthia Lummis, R-Wyo., whose office released the text earlier on Wednesday, argued in another statement that “no president in American history has willingly accepted self-imposed, substantive ethical restrictions like President Trump has.” In an attached fact sheet, Lummis maintained that the sunset provision for the ethics rules was included to emphasize Trump’s accountability, declaring, “This is a commitment President Trump has made for himself, rather than an obligation imposed by Congress.”
Upcoming Developments
The Senate has only a few days left to proceed with a vote on the Clarity Act before Congress departs for its August recess. So far, no Democratic senators have publicly supported the bill, making it unlikely that it will garner the 60 votes necessary for advancement.