Clarity Act hits new twist as democrat rejects White House ethics plan

The CLARITY Act entered another phase after President Donald Trump agreed to an ethics provision tied to the crypto market structure bill, a move that Republicans believe could remove the final legislative obstacle before a Senate vote.

However, the development did not immediately resolve the bill’s biggest challenge. Democrats had not yet reviewed the updated language, and several lawmakers said their support would depend on whether the new provisions met their expectations.

CLARITY Act faces democratic resistance despite White House agreement

According to reports from Crypto in America’s Eleanor Terrett and Punchbowl News’ Brendan Pedersen, Trump approved the revised ethics language on July 20, and the proposal was distributed to a group of Senate Republicans later that day.

The ethics provision became the final unresolved issue after lawmakers negotiated broader digital asset regulations contained in the bill. The measure would assign most crypto oversight to the Commodity Futures Trading Commission while leaving securities-related digital assets under the Securities and Exchange Commission.

It also includes protections for customer assets during bankruptcy proceedings and safe-harbor provisions for decentralized finance developers.

The ethics language is about the extent to which the president, vice president, members of Congress, and other high-ranking federal officials can acquire, hold, trade, and profit from digital assets while in office.

The controversy came to light after President Trump released his financial disclosures on July 1, which disclosed that he received nearly $1.4 billion in cryptocurrency-related income in 2025, most of which was tied to World Liberty Financial and his memecoin. 

Last month, financial disclosures revealed that Trump had taken millions of dollars from WLF, adding fuel to the debate over ethics protections. 

The provision was previously discussed during a July 16 meeting involving Trump, Senators Bernie Moreno and Cynthia Lummis, and White House crypto adviser Patrick Witt.

Senate divided over updated ethics language

The updated provision was dubbed “a major step forward” by Republican lawmakers. Senator Bernie Moreno called it the strongest ethics language included in any legislation passed by Congress.

Democratic legislators had a different opinion. One of just two Democrats to vote to advance the bill from committee, Sen. Ruben Gallego called the Republican idea very weak.

In addition, Senator Cory Booker also emphasized that only a bipartisan agreement could move the legislation forward, while another group of Senate Democrats has already threatened to block the measure.

Senate timeline narrows as Bill text awaits release

Republicans currently control 53 seats in the Senate, which they will require at least seven Democrats to secure passage of the CLARITY Act. There are no public Democratic senator endorsements of the amended ethics language as of the latest count.

The bill text, as reported by Cryptopolitan, may be available within a few days, though it may take longer for lawmakers to agree on a final version. The Senate is scheduled to take a break around Aug. 8 for the month of August, giving Majority Leader John Thune a limited opportunity to set up a floor vote.

Meanwhile, White House crypto adviser Patrick Witt, who has led negotiations on the measure, said his previously scheduled training with the Georgia Army National Guard had been postponed. His deputy director, Harry Jung, also announced plans to leave the administration in two weeks.

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