US crypto bill faces delay as Trump rejects ethics language
The first comprehensive US crypto regulation risks stalling after President Trump refused to sign off on ethics provisions that would restrict federal officials from profiting from digital assets.
President Trump did not agree to ethics language during a July 16 Oval Office meeting with Republican Senators Cynthia Lummis and Bernie Moreno, along with White House crypto adviser Patrick Witt. The session, intended to resolve the final obstacle to the Clarity Act, ended without a deal on provisions that would limit how presidents, vice presidents and lawmakers profit from digital assets.
The sticking point is Trump's personal crypto wealth, which includes memecoins and a stake in his family's World Liberty Financial. Financial disclosures last month revealed holdings worth hundreds of millions of dollars tied to WLF. "There's concerns on if any of these provisions could potentially harm him in the future," an industry source said of the president's position.
Without presidential buy-in on these rules, the legislation risks losing the Democratic votes necessary for Senate passage. Senator Ruben Gallego warned that Republicans are negotiating an ethics package without Democratic input. "You’re not going to have the Democratic votes," Gallego said. An industry source noted that ethics provisions are "absolutely essential" to secure the required support in the chamber.
The Clarity Act would establish the first federal regulatory framework for the digital asset sector, a long-sought milestone for institutional investors seeking clear compliance rules. Passage would fundamentally alter the operating environment for US crypto exchanges and token issuers. However, the legislative window is rapidly closing. The Senate has only until the first week of August to vote, after which the bill must return to the House before reaching the president's desk.
Trump has publicly urged the Senate to pass the legislation, framing it as a race against China. Yet, the White House has kept the details of the ethics negotiations tightly guarded, leaving Democratic staffers and industry observers in the dark. "What we need is for the White House very quickly, very early this week to put something on the table in order to keep this all moving or we're going to run out of time," an industry source said.
