Passage of the “Clarity Act” remains stalled as Democrats in the U.S. Congress balk at President Donald Trump’s proposed “ethics clause” for the cryptocurrency legislation.
Democratic lawmakers are said to be unhappy with the proposed language in the Clarity Act that would ban government officials from significant crypto ties.
There is also reportedly disagreement over who will enforce the crypto ban among federal politicians in the U.S.
Democrats want state attorneys general to enforce the ethics restrictions on federal officials, while the White House is insisting on the U.S. attorney general in Washington, D.C.
Debate over the ethics clause that would ban politicians from owning and trading crypto comes after reports that Trump earned more than $1 billion U.S. in 2025 from digital asset investments.
Since returning to the White House, Trump has issued his own meme coins and invested in several cryptocurrency ventures. He has also hosted dinners for investors in his meme coins.
Members of Trump’s family are also involved in crypto, with sons Eric and Don Jr. co-founding World Liberty Financial that issues the WLFI token.
The Digital Asset Market Clarity Act is meant to establish a unified regulatory framework for cryptocurrencies and digital assets.
The legislation proposes to split regulatory oversight of cryptocurrencies such as Bitcoin (BTC) between the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC).
Passage of the Clarity Act this year looks increasingly doubtful as Congress heads into its summer recess and with congressional midterm elections taking place this November.
Bitcoin is trading at $65,650 U.S. on July 22.
