Billions on the table: Senate crypto vote tests how far Trump's ethics concessions really go

The US Senate is set to vote on Tuesday on whether to advance sweeping legislation creating a new regulatory framework for cryptocurrency, a pivotal election-year test for the $2.3 trillion market, with many Democrats arguing the bill does too little to rein in President Donald Trump's personal crypto investments, AP reported.

The procedural vote comes just two months before the US midterm elections, at a time when the crypto industry has grown into a significant political force and Trump has amassed substantial crypto wealth while in office.

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While some Democrats back the broader idea of a regulatory framework, a longstanding industry priority, the party has largely stayed united against the bill unless it includes stronger ethics safeguards preventing the president and his family from profiting off the office.

"Let's make sure that we do not pass a crypto bill that will let Donald Trump continue to rake in billions of dollars in crypto profits while working families across this country struggle to deal with higher prices and an economy that gets worse by the day," Massachusetts Senator Elizabeth Warren, the top Democrat on the Senate Banking Committee, said in a floor speech on Monday.

What is the Clarity Act?

The legislation at the centre of the vote is the Digital Asset Market Clarity Act, a market-structure bill that has been in the works for roughly a year and would establish clear federal rules for how cryptocurrencies are regulated, resolving longstanding jurisdictional disputes between the Securities and Exchange Commission and the Commodity Futures Trading Commission.

The bill ccleared the Senate Agriculture Committee by a 12-11 party-line vote in January this year and the Senate Banking Committee in May, but has since stalled as Republican leaders worked to secure the 60 votes needed to overcome a filibuster. Republicans hold 53 seats in the Senate, meaning at least seven Democrats need to back the bill for it to advance.

It follows separate legislation enacted last year regulating stablecoins, a type of cryptocurrency, which barred members of Congress and their families from profiting off such tokens but did not extend those restrictions to Trump or his family.

Trump's concessions

As Democrats threatened to block the bill, Trump agreed to a series of ethics concessions, including new restrictions barring federally elected officials from issuing digital assets such as the presidential meme coins he and First Lady Melania Trump launched before his second term began. On Sunday, Trump agreed to further concessions, including expanded enforcement powers for state attorneys general that Democrats had sought.

Even so, those concessions do not appear to have satisfied most Democrats. A proposal from Democratic Senator Ruben Gallego of Arizona and Republican Senator Thom Tillis of North Carolina had sought to require Trump to place his crypto holdings in a blind trust and divest once those holdings crossed a certain value.

"[The bill] leaves a lot to be desired," Gallego said on Monday evening, as per AP, adding that he planned to offer a counterproposal, though it remained unclear whether the two sides would reach agreement before Tuesday's vote.

How much has Trump made from crypto?

Trump's family has posted substantial profits from crypto since his re-election, including from the meme coin launched a day before he took office, an event that saw top investors invited to a private reception with the president. The family also holds a controlling stake in World Liberty Financial, a crypto firm co-founded with Trump's special envoy Steve Witkoff. Trump reported more than $500 million in revenue from World Liberty Financial's sales of crypto products, including "governance tokens," in his annual disclosure filed with the Office of Government Ethics — a significant share of the more than $1.4 billion he reported from crypto businesses last year, according to AP.

What backers and critics say

Republicans working on the bill for the past year warn it could stall indefinitely if the Senate fails to advance it on Tuesday, since the House and Senate will be out of session in October and ahead of the elections, with the political dynamics potentially shifting sharply if Democrats retake either chamber in November.

Republican Senator Cynthia Lummis of Wyoming, a lead sponsor of the bill, said a "no" vote would mean "opposing real ethics reforms on politicians' personal investments, handing American leadership in digital assets to our foreign competitors, and leaving Americans with zero protections in the digital asset markets."

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Supporters argue the bill would give the industry legal certainty while protecting consumers through a broad set of guardrails, better enforcement against bad actors, and safeguards against market collapse. Opponents, largely Democrats, call it a giveaway to an industry that strongly backs the legislation and has become a major donor to candidates across both parties — spending more than $130 million on congressional races in 2024 alone, including $40 million in Ohio and $10 million each in Arizona and Michigan.

"DC received a clear message that being anti-crypto is a good way to end your career, as it doesn't represent the will of the voters," Coinbase CEO Brian Armstrong wrote in a social media post the day after the 2024 election.

(With inputs from AP)