Goldman Sachs CEO David Solomon has voiced support for a US Senate bill intended to reshape crypto market structure, arguing that the proposed Digital Asset Market Clarity (CLARITY) Act is “not perfect” but could help create a more consistent framework for participants.

According to a Thursday report by Politico, Solomon framed the legislation as necessary to establish a “level playing field” that could improve market stability as digital asset markets continue to develop.

Key takeaways

• David Solomon says the CLARITY Act is “not perfect,” but supports it for creating a more “level playing field” to bolster stability.
• Many industry leaders oppose the bill’s approach, including concerns that it would allow certain crypto firms to pay yield related to stablecoins outside existing financial-institution rules.
• Republicans released the CLARITY Act text ahead of a potential Senate vote, but Senate leaders had not scheduled timing as of Thursday.
• Democrats and critics highlighted ethics provisions, with objections centered on enforcement and accountability mechanisms.
• The bill likely requires additional Democratic votes to reach the Senate’s 60-vote threshold.

Solomon’s “level playing field” argument

In comments reported by Politico, Solomon emphasized that legislation is rarely flawless, but maintained that CLARITY’s central purpose is to normalize how digital asset markets operate—at least relative to how traditional finance is regulated.

His view stands in contrast to broader skepticism within parts of traditional banking circles, where executives have questioned whether CLARITY expands regulatory permission in ways that could weaken investor and depositor protections.

Politico’s report also notes that Solomon’s endorsement is relatively uncommon among leaders at major financial institutions considering the bill.

Banking concerns over stablecoin yield permissions

A key point of contention involves whether crypto firms would be allowed to offer interest or yield on stablecoins under rules that critics say do not map cleanly to the protections expected of regulated financial institutions.

Earlier coverage highlighted that many peers oppose the bill on these grounds, arguing that the proposal’s stablecoin yield approach does not provide the guardrails banks would be expected to meet. Cointelegraph previously reported on these concerns.

The contrast in views is also reflected in remarks from JPMorgan Chase chief Jamie Dimon. As reported in an interview conducted in May, Dimon said CLARITY would let crypto companies pay interest on stablecoins “without the protection that they should have,” arguing that banks would not accept a similar arrangement. The interview was shared on YouTube.

Democrats focus on ethics provisions and enforcement

Even as the CLARITY Act moves toward a possible Senate vote, Democratic lawmakers have signaled resistance—not only on technical market-structure issues, but also on ethics language attached to the bill.

As described in reporting from Cointelegraph and subsequent commentary, Democrats are concerned that the ethics provisions do not go far enough and that enforcement would be left to the US Department of Justice rather than state authorities. If Republicans are unable to secure enough support beyond their ranks, the bill could stall at the 60-vote threshold required to advance in the Senate.

Senator Elizabeth Warren, a leading Democratic critic, said in a statement released alongside the Wednesday publication of the bill text that she believes the legislation is designed to protect President Donald Trump’s crypto profits and that it fails to adequately safeguard investors, the financial system, and national security. The statement was posted by the Senate Banking Committee’s minority.

Cointelegraph earlier also reported on Democrats’ objections to the ethics language during the markup process, underscoring how these provisions have become a central political obstacle for CLARITY. Earlier coverage details the core Democratic concerns.

What happens next in the Senate

Republicans released the full CLARITY Act text on Wednesday, setting the stage for potential Senate action. However, as of Thursday, Senate leaders had not scheduled a vote, according to the Politico report.

With multiple factions still divided—particularly over stablecoin yield permissions and ethics/enforcement mechanics—the immediate question for investors and market operators is whether amendments can narrow the gap between competing priorities or whether the bill will face a larger momentum reversal.

Readers should watch for whether Senate leaders set a vote date soon and, more importantly, whether any compromise emerges that could attract enough Democratic support to meet the 60-vote threshold—since the bill’s advancement appears tightly linked to both ethics politics and the future regulatory treatment of stablecoin-related yield.

Ripple has invested an undisclosed amount in Notabene to bring RLUSD payments to an institutional network processing more than $2 trillion in annualized transaction volume.

Notabene announced the strategic investment in a press release, adding that the two companies will work together to expand regulated stablecoin payments for businesses. Under the agreement, Notabene will integrate Ripple USD, commonly known as RLUSD, into Notabene Flow, its business-to-business stablecoin payment platform.

Once integrated, RLUSD could become available across one of the largest networks connecting regulated digital asset companies. Notabene described the collaboration as a route for institutions to use the stablecoin while meeting payment authorization and compliance requirements.

Alongside the RLUSD integration, Ripple and Notabene will examine how trusted payment authorization could support Ripple Payments. According to Notabene, its infrastructure gives regulated institutions the information needed to identify counterparties, understand payment purposes and approve transactions without adding unnecessary friction.

“The partnership is set to accelerate adoption of compliant stablecoin payments while creating a pathway for RLUSD to be integrated across one of the world’s largest institutional payment networks for digital assets,” Notabene stated.

Notabene gives RLUSD access to regulated payment counterparties

Notabene co-founder and CEO Pelle Braendgaard identified uncertainty over transaction details as a central problem for companies considering stablecoins. In his assessment, institutions need to know who is receiving a payment, why the transaction is taking place, and how it can be authorized within their existing controls.

Braendgaard argued that Notabene’s network provides those functions through connections with regulated institutions. Combined with Ripple’s payments business and RLUSD, he expects the infrastructure to help companies move stablecoin payment programs beyond limited trials.

“That is what Notabene and its network of regulated institutions solve. Paired with an enterprise-ready stablecoin like RLUSD and Ripple’s global payments reach, it turns compliant stablecoin payments from a pilot into a real growth engine that reaches more counterparties and moves more volume, faster,” Braendgaard said.

Ripple Senior Vice President of Stablecoin Jack McDonald also linked the investment to a long-standing barrier facing enterprise users. According to McDonald, Notabene supplies part of the compliant infrastructure that institutions require before moving money at an international scale.

“Together we’re helping build the compliant infrastructure institutions need to move value at global scale while expanding the utility of RLUSD.”

The agreement comes as Ripple builds regulated payment access for RLUSD in Europe. As crypto.news reported, Ripple Payments Europe appeared alongside 14 other companies in the European Securities and Markets Authority’s latest Markets in Crypto-Assets register update on July 18.

ESMA’s register lists Ripple Payments Europe SA as an authorized crypto asset service provider. According to the register, the approval enables Ripple’s European payments subsidiary to provide regulated crypto services across 29 European Union countries.

Ripple had previously secured authorization in Luxembourg under the MiCA framework. The company stated that the Luxembourg license allows its local subsidiary to provide services to financial institutions and businesses across the European Economic Area.

Paired with Ripple’s existing electronic money institution license in Luxembourg, the crypto asset service provider approval permits the company to offer crypto asset and stablecoin payment services. Ripple says banks, fintech firms and corporate clients can use a single integration to collect funds, exchange assets and make payments.

Regulatory progress supports Ripple’s institutional payment strategy

In the United States, Ripple is also pressing lawmakers to establish federal rules for crypto markets. Ripple CEO Brad Garlinghouse on July 22 backed Chief Legal Officer Stuart Alderoty’s call for Congress to pass the Digital Asset Market Clarity Act despite unresolved disputes surrounding the legislation.

Alderoty urged lawmakers not to abandon the bill while pursuing a perfect compromise. His appeal followed the release of updated legislative text and came as Congress moved closer to its August recess, while a group of Senate Democrats renewed resistance to the proposal.

Describing the CLARITY Act as a consumer protection measure, Alderoty argued that it would reinforce anti-money laundering and know-your-customer standards. He also maintained that the legislation would give law enforcement agencies and state authorities clearer powers to address misconduct.

Garlinghouse endorsed that assessment after Ripple had supported federal market structure legislation during the current negotiations. The company’s policy push accompanies rising institutional interest in stablecoin payments following the passage of the GENIUS Act.

RLUSD has also secured integrations beyond the planned Notabene Flow addition. Renewed interest in the stablecoin follows BNY Mellon’s plan to develop a 24-hour settlement system for the U.S. Treasury market, although the bank’s initiative remains separate from Ripple’s Notabene agreement.

Through the investment, Ripple gains a route into Notabene’s regulated network without acquiring the company or disclosing the size of its stake. Notabene, in turn, will add RLUSD to payment infrastructure already used by institutions handling more than $2 trillion in annualized transaction volume.

Convicted fraudster and Nigel Farage backer George Cottrell had $9 million deposited into his Polymarket account by two unknown sources.

That’s according to the Financial Times (FT), which reported that Cottrell’s Polymarket account — which has the username “GCottrell93” — received $8.8 million in October 2024. 

It received $7 million across five different transactions from a wallet on crypto exchange OKX, and received another $1.83 million from a wallet on ChangeNOW. 

These funds were used almost immediately to bet on whether or not Trump would win the US election. From here, the FT claims $13 million in winnings was sent to an OKX wallet while $282,000 was sent to ChangeNOW.

Cottrell was previously convicted of wire fraud in March 2017 after he was caught agreeing to launder drug trafficking proceeds.

For many years, Cottrell and his relationship with Farage had gone largely under the radar. However, this past year has seen him thrust into the limelight after Farage was discovered to have accepted, without declaring, a £5 million gift from multi-billionaire Tether investor Christopher Harborne.  

Cottrell was also revealed to have funded staff, security, and housing for the Reform UK leader before his election in 2024.

None of this was declared, and has since been referred to the UK’s Parliamentary Commissioner for Standards.

Read more: Nigel Farage aide George Cottrell bets US war will last four more months

Cottrell has continued to bet on Polymarket throughout the year. Protos reported in March 2026 that he bet $41,000 that the US war with Iran would last another four months.

One of his larger bets currently involves $71,000 on whether or not Vice President JD Vance will win the Republican nomination for president in 2028.

In addition to the FT’s report, Byline Times also revealed today that Cottrell has in the past used a fraudulent Swiss passport, under the name of “Oscar Drewitt.” 

This fraudulent identity was reportedly known by Reform UK’s former Treasurer, Mehrtash A’zami, who hired Cottrell into a City financial network while using this Swiss alias. 

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Byline Times also discovered that a fellow gambler called Hon Kong Yong introduced Cottrell to this network under the false alias, and that Yong and A’zami have companies registered under the same Montenegro Tivet office, which Harborne and two other former Reform UK officials were linked to.  

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Democratic lawmakers are pushing back against the latest draft of the CLARITY Act over its ethics provisions. The lawmakers believe the provisions do not adequately address President Trump’s crypto interests.

Lawmakers have signalled support for the legislation if stronger provisions are included. However, the bill has found support in the crypto industry, with Coinbase and Ripple backing it.

Democratic Lawmakers Push Back Against Clarity Act Draft

Republican lawmakers released the latest draft of the CLARITY Act on Wednesday (July 22), with several prominent figures from the crypto industry supporting the measure. However, the legislation quickly faced fierce pushback from Democratic lawmakers over weak ethics provisions. The lawmakers argued that the provisions were inadequate to address President Trump’s crypto links. Senator Angela Alsobrooks said the current draft fell short and asked for key provisions to be strengthened, stating, “The Republican-proposed text of the CLARITY Act as it currently stands falls short. Key provisions including those addressing ethics for elected officials, consumer protection, illicit finance, conflicts of interest and market integrity must be strengthened.”

President Trump and his family remain involved in the crypto industry, with interests including a popular memecoin and World Liberty Financial, a decentralized protocol that operates a borrowing-and-lending platform. According to financial disclosures, President Trump received millions tied to WLF.

Incomplete Enforcement Mechanism

The 616-page draft prohibits public officials and their spouses from sponsoring and issuing digital assets. However, it does not prohibit extended family members. The draft also includes a clause stating the restrictions expire in January 2029 and tasks the Justice Department with enforcing the provisions. Senator Ruben Gallego supported the bill in the committee but has ruled out backing it in the Senate unless the ethics language is changed. Besides Alsobrooks and Gallego, Senate Democrats Catherine Cortez Masto and Cory Booker have also opposed the bill in its current form.

Senator Elizabeth Warren took to X, criticizing the bill and stating, “The new draft of the Senate GOP crypto bill does nothing to stop President Trump from making his next $1.4 billion from crypto. It’ll supercharge Trump’s crypto corruption. This bill should be dead on arrival.”

Amanda Fischer, Chief Operating Officer and policy director for Better Markets and former chief of staff for Gary Gensler, believes the draft does not change much for President Trump and his entanglement with crypto.

“The bottom line: Doesn’t change much at all about Trump’s existing crypto grift. No divestment required. Maybe stops new crypto grifts, but it’s up to his personal attorney [Acting U.S. Attorney General] Todd Blanche to enforce. Amnesty kicks in as soon as the new POTUS is inaugurated.”

Support From The Crypto Industry

Unsurprisingly, prominent individuals from the crypto industry threw their weight behind the legislation. Supporters were happy the bill retained software developer protections and added that the legislation would ensure regulatory clarity and elevate the US’ role in the digital asset industry. Ji Hun Kim, CEO of the Crypto Council for Innovation, urged for bipartisan support to get the bill across the line, and Solana Policy Institute CEO Miller Whitehouse-Levine called on Congress to “seize the moment.”

The strongest support for the bill came from Coinbase and Ripple. Coinbase CEO Brian Armstrong said the lack of a clear regulatory framework had hurt the industry, allowing major incidents like the FTX collapse to hurt consumers. Stuart Alderoty, Chief Legal Officer at Ripple, said the bill gives law enforcement agencies the teeth to go after bad actors, while CEO Brad Garlinghouse stated the bill does not have to be perfect to pass.

Supporters of the legislation are urging Congress to vote on the bill before its August recess. However, this depends on whether Democrats and Republicans can agree to a timely compromise.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Empery Digital said it invested $20 million in Cardinal Data Power, acquiring an approximately 8% stake in the private developer of powered data center campuses.

The investment was part of Cardinal Data Power’s approximately $70 million Series A financing and will support development of a 750-megawatt data center campus in West Texas. The project is expected to deliver its first power in 2027, expand to about 1 gigawatt by 2029 and eventually exceed 5 gigawatts.

Cardinal develops powered data center campuses for artificial intelligence and high-performance computing workloads. The company said it combines power generation, natural gas supply and electrical infrastructure to accelerate development of large-scale computing sites.

Empery has been moving away from its Bitcoin (BTC) treasury strategy, which it adopted in mid-2025 after pivoting from its former electric powersports business. Earlier this month, the company disclosed it had sold about 1,400 Bitcoin over a two-month period for roughly $87.1 million, using the proceeds to fund AI infrastructure investments and repay debt.

The sale came as Empery faced mounting pressure from shareholder Tice P. Brown, who called on the company to abandon its treasury strategy and sought the resignation of its chief executive officer and board.

The transactions reduced the company’s Bitcoin holdings to 1,514 BTC. Empery had previously held as many as 4,081 BTC before beginning to trim its position in March, according to data from BitcoinTreasuries.NET.

Related: Bernstein says Bitcoin mining deals necessary for AI power crunch

Bitcoin treasury companies take divergent paths

The Bitcoin treasury model is evolving, with some companies doubling down on accumulation while others are pivoting, restructuring or exiting altogether.

Satsuma Technology became one of the first Bitcoin treasury companies to unwind after shareholders voted overwhelmingly on July 20 to sell the company’s Bitcoin holdings, return substantially all of its capital to investors and delist from the London Stock Exchange. More than 90% of votes cast supported both the capital return and the delisting.

Meanwhile, a proposed merger between Tether-backed Twenty One Capital, Strike and Bitcoin miner Elektron Energy was scrapped earlier this week, leaving Strike as a standalone company while discussions between Twenty One and Elektron continue

Despite the change, Twenty One remains one of the world’s largest corporate Bitcoin holders with 43,514 BTC, second only to Strategy among publicly tracked corporate treasuries.

Top 10 Bitcoin treasury companies. Source: BitcoinTreasuries.NET

Other entrepreneurs are taking the Bitcoin treasury concept in a different direction. Last week, Bitcoin analyst Lyn Alden co-founded Orange Juice HODLINGS, a permanent-capital holding company backed by Mexican billionaire Ricardo Salinas that launched with $40 million in initial funding.

Rather than simply accumulating Bitcoin, the company plans to acquire and hold profitable businesses indefinitely while using Bitcoin as its treasury reserve asset, combining long-term business ownership with a Bitcoin-backed balance sheet.

Magazine: Fears of AI-driven DeFi hack epidemic overstated for now — but not for long

Negotiations over the long-awaited US Digital Asset Market Clarity Act—known as the CLARITY Act—have reportedly narrowed to one of the most politically sensitive issues: ethics rules for federal officials and who will enforce them. After months of drafting and bargaining, a dispute over a “code of conduct” element is now threatening to derail a bill that many in the industry view as crucial for regulatory certainty.

Democratic senators say the current version of the proposal does not go far enough, particularly on ethics provisions covering elected officials and related consumer and market-integrity safeguards. Republicans, meanwhile, argue that ethics enforcement should remain within the Department of Justice (DOJ) under a single national framework, rather than being handled by state attorneys general.

Key takeaways

• Seven Democratic senators said the current CLARITY Act text “falls short,” calling for stronger ethics, consumer protection, illicit finance, conflict-of-interest, and market-integrity provisions.
• The latest draft would bar senior federal officials and their spouses from issuing or sponsoring digital assets while in office, alongside limits on crypto platforms listing such assets.
• Democrats want ethics enforcement to allow state attorneys general to step in if DOJ does not enforce the law; Republicans insist DOJ should be the sole enforcement channel.
• Multiple policy and industry stakeholders say lawmakers may still be able to compromise, but uncertainty over ethics is becoming the central bottleneck.
• Even if senior officials are restricted from sponsoring or issuing new tokens, the draft would still allow covered officials to own cryptocurrencies.

What the new CLARITY ethics language would change

According to the latest Senate draft made public Wednesday, the CLARITY Act would prohibit the president, vice president, members of Congress, and other senior federal officials—along with their spouses—from issuing or sponsoring digital assets while they are in office. This would apply to officials covered under the bill’s ethics framework.

The draft also includes a platform-facing restriction: crypto platforms would be prevented from listing assets issued or sponsored by covered officials. As described in coverage of the text, these prohibitions are set to expire in 2029, after President Donald Trump’s current term ends.

Importantly for investors and market participants, the restrictions would focus on “issuing or sponsoring” while in office, not on personal ownership. Covered officials would still be allowed to hold cryptocurrencies even during the restricted period.

Why Democrats say the proposal isn’t strong enough

In a joint statement released Wednesday, seven Democratic senators argued that the bill’s current provisions are inadequate. They said “key provisions,” including those addressing ethics for elected officials, consumer protection, illicit finance, conflicts of interest, and market integrity, must be strengthened.

“Key provisions including those addressing ethics for elected officials, consumer protection, illicit finance, conflicts of interest and market integrity must be strengthened,” the senators said.

Senator Angela Alsobrooks—speaking at a Semafor event on Wednesday—stated that while negotiations may be “fairly close,” the ethics language remains a dealbreaker. She indicated she would not support the legislation on the Senate floor unless it includes stronger ethics provisions.

Alsobrooks’ primary concern is both the substance and the enforcement structure. She said it cannot be taken for granted that DOJ will enforce the law effectively, framing the issue as a credibility problem rather than a purely theoretical one.

Democrats’ stance has been amplified by scrutiny of President Trump’s growing crypto-related business interests, which have reportedly included meme coin activity and a broader portfolio of digital asset exposure. Critics argue that this creates incentives and potential conflicts that stronger ethics and enforcement mechanisms should address.

Senator Elizabeth Warren has also signaled that she views the draft as insufficient, arguing that it would not prevent the president from profiting from new crypto activity in a way that could be economically significant. Separately, former SEC official Amanda Fischer argued that the restrictions could still allow the president to benefit from existing crypto projects, with the proposed limitations aimed at future income streams.

Republicans push for DOJ-only enforcement

Republicans contest the idea that the ethics provisions are too weak, while also objecting to Democratic calls for additional enforcement leverage for state attorneys general. They argue that federal ethics requirements should be enforced through a single national mechanism—DOJ—rather than through a patchwork of state interpretations and political priorities.

Attorney and former Republican Senate candidate John Deaton said the CLARITY Act is federal legislation and that DOJ, not “fifty different state AGs,” is the appropriate body to enforce federal law. In this view, allowing state officials to intervene would risk undermining the uniformity that supporters say the bill is intended to provide.

Other Republican-aligned commentators characterized the ethics language as unprecedented. For example, Senator Bernie Moreno described the current draft as containing “the most powerful ethics language in US history.”

Patrick Witt, a former White House and Senate counsel, suggested the disagreement may be driven by two incompatible Democratic positions: that ethics rules would be meaningless without state AG enforcement, or that the proposal could not be changed in a way that would satisfy concerns about constitutional constraints. Witt argued that endorsing the first position would effectively dismiss the enforceability premise behind existing federal ethics laws, while the second position would be difficult or impossible to meet without violating constitutional principles.

Industry and policy observers see a path—but not an easy one

Despite the ethics dispute, many observers believe the bill can still progress through negotiation. Kristin Smith, former CEO of the Blockchain Association and now president of the Solana Policy Institute, told Cointelegraph that the latest draft reflects meaningful compromise on ethics—an element viewed as necessary for Senate Democrats to come closer to supporting the measure.

Smith also emphasized that ethics is only one component of the broader package. She pointed to additional elements added to the Senate’s work, including a disclosure regime, an illicit finance section, and improved spot market regulation. In her view, rejecting the bill on ethics alone could mean lawmakers lose more than just the ethics language—they could lose the rest of the regulatory structure altogether.

“There is no version of a ‘no’ vote that produces a stronger bill,” Smith said. “A ‘no’ vote produces no bill at all: no disclosure regime, no illicit finance protections, no spot market improvements, no ethics provisions, nothing.”

Vincent Chok, co-founder and CEO of stablecoin issuer First Digital, likewise suggested that narrowing negotiations to ethics rather than the overall structure indicates progress. He framed the question less as whether the US needs a framework and more as how to finalize one that can attract broad support.

Chok argued that no regulatory scheme is likely to be perfect at the start, but businesses can adjust if the market gets clarity. Long periods of uncertainty, he said, make it harder to justify long-term investment and product development.

Other industry figures expressed cautious optimism while still criticizing how far the initial ethics proposal goes. Salman Banaei, head of public policy at Plume, a blockchain network focused on tokenized real-world assets, said compromise may be possible, but cautioned that the White House’s initial ethics proposal was “not a good starting point.”

At the heart of the debate remains the enforcement question: the current draft appears to rely heavily on DOJ for ethics implementation, while Democrats want a mechanism that gives state attorneys general a clearer role if federal enforcement falls short. How lawmakers balance these competing views—without stalling the broader CLARITY framework—may determine whether the bill reaches the next stages.

As negotiations continue, the key variable for readers is whether the parties can agree on an enforcement structure that satisfies Democrats’ concerns about DOJ reliability while preserving Republicans’ push for a single federal enforcement lane. With the bill’s timetable dependent on this remaining sticking point, investors and builders should watch for the next revised ethics draft and any accompanying language changes that clarify whether enforcement authority can shift beyond DOJ.

The long-awaited US Digital Asset Market Clarity Act (CLARITY) has hit another snag.

This time, it’s not software developers or the turf war between federal regulators at stake, but the thornier question of ethics — ironic, given many politicians’ demonstrable disdain for them.

After months of negotiations and what Coinbase’s chief executive Brian Armstrong called “thousands of hours of work on both sides,” disagreement over a code of conduct could make or break CLARITY once and for all.

Pretty much everyone agrees the United States needs clearer rules around digital assets. But negotiators are divided over whether the bill’s ethics provisions are strong enough, and, more importantly, who should enforce them.

Democrats worry the current proposal relies too heavily on the Department of Justice, arguing state attorneys general should be able to step in if the DOJ fails to enforce the law.

In a joint statement Wednesday, seven Democratic senators said the Republican proposal “falls short.”

“Key provisions including those addressing ethics for elected officials, consumer protection, illicit finance, conflicts of interest and market integrity must be strengthened,” the senators said.

For their part, Republicans are pushing to keep enforcement of the ethics provisions with the DOJ, arguing that federal rules should be enforced through a single national framework. Attorney and former Republican Senate candidate John Deaton said Wednesday:

“The CLARITY Act is federal legislation… The Department of Justice – not fifty different state AGs with fifty different political incentives and fifty different interpretations – is the appropriate body to enforce federal law.”

Can lawmakers find a middle path before the bill reaches the Senate floor, or has the ethics debate become CLARITY’s biggest obstacle yet?

What the latest ethics proposal actually does

The latest Senate draft made public Wednesday would prohibit the president, vice president, members of Congress and other senior federal officials and their spouses from issuing or sponsoring digital assets while in office.

Democrats oppose current CLARITY text. Source: Senator Ruben Gallego

That means future presidential meme coins would be off the table, at least temporarily, with no Trump 2.0 or Melania 2.0-style token launches while the restrictions are in play.

Related: CLARITY Act could help CFTC deal with prediction markets: Lawyer

The proposal would also prevent crypto platforms from listing assets issued or sponsored by covered officials.

Restrictions would expire in 2029, after President Donald Trump’s current term ends, though covered officials would still be permitted to own cryptocurrencies.

Democrats say current proposal falls short

Democrats have made it clear the text needs additional work before gaining their support, but getting CLARITY over the line isn’t doomed; they’ve also signaled a willingness to see the bill through to the end.

“We have been working in good faith with our Republican colleagues for the past year and will continue doing so to get this over the finish line,” the senators said.

Senator Angela Alsobrooks said negotiators were “fairly close” to reaching an agreement during a Semafor event on Wednesday, despite warning the ethics provisions remained a dealbreaker. The Maryland Democrat said:

“Although I have been supportive to this point, I absolutely will not support on the floor any legislation that does not include provisions around ethics.”

Her main concern is not only the substance of the rules, but who would enforce them.

“It’s an absolute that we cannot completely rely on the DOJ, given what we’ve seen of their inability and their unwillingness to enforce the law,” Alsobrooks said.

The debate has been fueled by Trump’s rapidly expanding crypto business interests spanning meme coins, World Liberty Financial and other digital asset holdings.

Related: Trump claims he can ‘future proof’ crypto regulation with CLARITY Act

The President’s crypto ventures have reportedly generated $1.4 billion on paper, prompting Democrats to argue stronger safeguards are needed to address potential conflicts of interest.

Senator Elizabeth Warren has focused on whether the restrictions go far enough, with the Massachusetts Democrat saying that the latest draft “does nothing to stop President Trump from making his next $1.4 billion from crypto.”

Former SEC official Amanda Fischer also argued the draft would still allow Trump to benefit from his existing projects, with limited restrictions on future crypto income streams.

Republicans say proposal already unprecedented

Republicans reject the idea that the ethics provisions are weak. Senator Bernie Moreno described the draft as containing “the most powerful ethics language in US history,” pushing back against Democratic claims that the provisions are insufficient.

The latest CLARITY Act text. Source: US Congress.

Patrick Witt, a former White House and Senate counsel, said Democratic opposition appeared to rest on one of two positions: either that ethics rules without state attorneys general are “meaningless,” or that they fail to penalize President Trump for past crypto activity.

“If you hold position (1), then you are basically saying that ALL current federal ethics laws are meaningless because none of them are enforceable by state AGs,” he said. “If you hold position (2), then there is literally nothing that can be done to appease you because what you are advocating for is blatantly unconstitutional.”

Others argue that, even if the legislation is imperfect, passing it would be preferable to preserving the status quo. Andreessen Horowitz co-founder Chris Dixon said the US has a similar opportunity to the early internet era, when lawmakers established rules that allowed innovation to flourish rather than forcing new technology into outdated regulatory frameworks.

While acknowledging that “no law is perfect,” Dixon argued the CLARITY Act would deliver long-overdue consumer protections and provide regulatory certainty for blockchain innovation in the US.

Can lawmakers find a middle path?

Despite stumbling over the ethics hurdle, most industry and policy observers still believe a deal remains in reach.

Kristin Smith, former chief executive of the Blockchain Association and now president of the Solana Policy Institute, sees that the latest draft is already a meaningful compromise.

“The new text includes a substantive, one-of-a-kind ethics provision, a necessary step to win the support of Senate Democrats,” Smith told Cointelegraph.

“But ethics is far from the only thing at stake. The Senate has added a full disclosure regime, an entire illicit finance section, and improved spot market regulation.”

Smith warned that rejecting the bill in pursuit of stronger ethics language could leave lawmakers stuck with no market structure legislation at all.

“There is no version of a ‘no’ vote that produces a stronger bill,” she said. “A ‘no’ vote produces no bill at all: no disclosure regime, no illicit finance protections, no spot market improvements, no ethics provisions, nothing.”

Vincent Chok, co-founder and chief executive of stablecoin issuer First Digital, said the fact negotiations have narrowed to ethics rather than the broader structure of the bill is itself a sign of progress.

“The core debate is no longer whether digital assets need a regulatory framework, but how to finalize one that commands broad support,” Chok told Cointelegraph.

He said that while no regulatory framework is likely to be perfect from day one, businesses can adapt to clear rules that evolve over time. Prolonged uncertainty makes long-term investment and product development far more difficult, he said.

Salman Banaei, head of public policy at Plume, a blockchain network focused on tokenized real-world assets, also believes a compromise remains possible, although he cautioned that the White House’s initial ethics proposal “is not a good starting point.”

For now, both sides appear to agree on one thing: a compromise is still possible, but exactly what it looks like remains the biggest unanswered question.

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