Trump Unlocks the CLARITY Act by Approving an Ethics Provision

The White House has approved an ethics component of the CLARITY Act and sent the text to Republican senators, removing the last major obstacle before a floor vote. Donald Trump personally gave his approval, rekindling hopes of adoption before the Senate’s summer recess.

The ethics deadlock finally comes to an end

For months, the CLARITY Act hit a wall technology alone could not overcome. The White House accepted an ethics package and sent it to Republican senators, an advancement Donald Trump personally approved.

The blockage was about ethics, not market regulation: Democratic senators Ruben Gallego and Angela Alsobrooks demanded a strict clause against conflicts of interest covering the president, vice president, and Congress.

The origin of the dispute dates back to the president’s personal crypto holdings. His 2025 financial disclosure values his digital asset income at over $1.4 billion, a lever for Democrats who found any provision lacking true enforcement power unacceptable. 

This stance shaped the project’s course, even as its market structure provisions gathered broad bipartisan support.

The news first circulated on X. Eleanor Terrett, host of Crypto in America, wrote she had gathered multiple industry sources confirming the agreement. The onchain analyst Wu Blockchain corroborated the scoop, marking the first sign of movement since talks broke off in early July.

I’ve heard from several industry sources that the White House has accepted an ethics package for the Clarity Act and sent the language to some Republican senators this afternoon.

The CLARITY Act redefines the boundary between the SEC and the CFTC

The CLARITY Act aims to end the jurisdictional war that has pitted the CFTC against the SEC for years on the qualification of digital assets. The bill assigns primary oversight of digital commodities like bitcoin to the CFTC, once a network is deemed sufficiently decentralized, while the SEC retains authority over tokens considered securities.

The text also classifies crypto held by customers as their property in case of exchange bankruptcy, filling a legal gap revealed by the collapse of Celsius and Voyager. 

The Senate Banking Committee has already advanced its version by a 15 to 9 vote in May, after about ten months of merging House and Senate texts. Details of this compromise, reported by Bitcoin.com, remain confidential for now.

The regulation of market structures has also received praise. Coinbase’s public affairs director called it a “spectacular step forward” for consumer protection during the committee vote, a sentiment strengthened by the duration of the ethical deadlock.

The legislative window closes in early August

Time now matters more than the text’s content. The Senate must begin its summer recess in the first week of August, leaving majority leader John Thune a few legislative weeks to bring the bill to the floor.

Republicans hold 53 seats, requiring them to rally at least seven Democratic senators to reach the 60-vote threshold needed to break a filibuster. Prediction market bettors gave the CLARITY Act only a 39% chance of becoming law in 2026 as the deadlock persisted, a sign of real doubt about Washington’s ability to decide in time.

Outside groups are applying pressure. A coalition of law enforcement organizations recently supported the bill, arguing clear federal rules would ease the fight against crypto fraud. Furthermore, Senator Cynthia Lummis publicly demands a floor vote in July. About 18 legislative days remain before the recess, and the revised bill version is expected in the coming days.

In summary, the White House’s ethics agreement turns the CLARITY Act from a stalled issue into a tangible priority for the executive before August. Three catalysts converge: Trump’s direct involvement in negotiations, law enforcement support, and the urgency of the schedule. American crypto regulation fits into a broader movement, already illustrated by the GENIUS Act on stablecoins. The next revised text will reveal if the Senate finally seizes its chance.