Senate Holds Key Procedural Vote on Clarity Act, the First Federal Crypto Regulatory Framework
The U.S. Senate voted Tuesday on whether to advance the Digital Asset Market Clarity Act, legislation that would establish the first federal regulatory framework for the cryptocurrency sector in U.S. history. The vote required 60 "yes" votes to clear the procedural hurdle, meaning all 53 Republicans plus at least seven Democrats or Independents. Most Democrats remained opposed unless the bill included stronger ethics provisions addressing President Trump's crypto investments.
The Digital Asset Market Clarity Act — commonly called the Clarity Act — is a bill stretching over 600 pages that would formally establish regulatory authority over the crypto sector for the first time in U.S. history, splitting oversight between the Securities and Exchange Commission and the Commodity Futures Trading Commission, with the CFTC holding the larger share of authority, according to NPR. A version of the bill already passed the House last year, but the Senate vote Tuesday was the bill's most critical test: a procedural threshold requiring 60 votes in a chamber where Republicans hold 53 seats.
The central sticking point has been a cluster of ethics provisions addressing Trump's crypto holdings. According to AP, Trump reported more than $500 million in revenue from World Liberty Financial — a crypto firm co-founded with his special envoy Steve Witkoff — and more than $1.4 billion total from crypto businesses in his most recent annual disclosure. Trump agreed before Tuesday's vote to new concessions, including restrictions on federally elected officials and their spouses from issuing their own cryptocurrencies, and additional enforcement powers for state attorneys general, per AP and NPR. Critics, however, said the ethics language remained too loose. Democratic Sen. Ruben Gallego of Arizona, who had sought language requiring Trump to place crypto holdings in a blind trust and divest above a certain threshold, said Monday evening that the latest version "leaves a lot to be desired."
Massachusetts Sen. Elizabeth Warren, the top Democrat on the Senate Banking Committee, argued on the Senate floor that passing the bill without stricter guardrails would allow Trump to "continue to rake in billions of dollars in crypto profits while working families across this country struggle." The DOJ's role in enforcement was a specific concern cited by NPR: Democrats objected that enforcement of the ethics clause would fall to a Justice Department led by Todd Blanche, Trump's former personal attorney.