Clarity Act revisions would ban presidents from issuing digital assets

Clarity Act revisions would ban presidents from issuing digital assets

Senate Republicans have revised the Clarity Act to include a provision that would prohibit the president, vice president, and other senior federal officials from issuing or sponsoring digital assets while in office. The updated text, which began circulating on Wednesday, July 22, 2026, also extends these restrictions to the spouses and employees of these officials.

The revisions target the ability of public officials to profit from the cryptocurrency industry. Under the proposal, covered individuals are barred from issuing or sponsoring a digital asset for compensation during their term. The bill defines issue as the act of creating, minting, launching, or controlling the initial distribution of an asset. Sponsoring is defined broadly to include funding, organizing, or publicly endorsing a token, including the use of an official's name, image, likeness, or position for promotion.

This language arrives as lawmakers face questions regarding the digital asset portfolio of President Donald Trump. The debate has centered on the TRUMP memecoin and the family-linked World Liberty Financial venture, alongside other branded digital products. According to reports, Trump's crypto businesses netted an estimated $1.4 billion last year.

The ethics framework does not impose a blanket ban on owning cryptocurrency. Officials may continue to hold digital assets as investments, provided they follow existing conflict-of-interest and disclosure requirements. However, the bill would require politicians to divest these assets or place them in a blind trust during their tenure.

To ensure compliance, the proposal would bar companies from listing any digital asset that was issued or sponsored in violation of these rules. But the restrictions are temporary; the ethics provisions are scheduled to sunset at noon on January 20, 2029, unless Congress votes to extend them.

The White House has indicated that President Trump would sign the bill despite these provisions, describing the Republican-authored language in a statement to CoinBase as the most comprehensive and wide-ranging ethics provision in history.

Despite this, the bill faces significant hurdles from Democrats. While some, such as Maryland Senator Angela Alsobrooks, previously voted to advance the bill out of committee on May 14, 2026, they have since signaled opposition to the current draft. The primary point of contention is enforcement. The revised text tasks the attorney general with enforcing the ethics rules while explicitly barring state attorneys general from doing so.

Speaking at a Semafor conference on Wednesday, Senator Alsobrooks called the reliance on the Justice Department wild and unserious and stone crazy, arguing that the department has shown an inability and their unwillingness to enforce the law. Alsobrooks has suggested that enforcement power should instead be given to state-level attorneys general.

The ethics debate has been a primary obstacle for the legislation, which requires 60 votes to pass the Senate. Earlier efforts to address these concerns included a May amendment by Democrat Chris Van Hollen, who sought to bar government officials from having any business ties to the crypto industry to prevent self-dealing. A separate House proposal had sought to ban presidential candidates from endorsing digital assets.

Beyond ethics, the expanded Clarity Act aims to create a comprehensive U.S. Rulebook for digital asset markets. It proposes splitting oversight between the Securities and Exchange Commission and the Commodity Futures Trading Commission based on whether an asset is a security or a commodity. The revised text expands CFTC oversight of digital commodity intermediaries, including brokers, dealers, custodians, and exchanges.

Additional measures in the bill include:

• Establishing federal jurisdiction over registered participants in digital commodity markets.
• Preserving state enforcement authority over general laws and fraud.
• Allowing courts to order the burning, freezing, seizure, and reissuance of payment stablecoins.
• Integrating law-enforcement measures and technical amendments linked to the GENIUS Act.

The House passed its version of the bill in July 2025. For the current Senate version to become law, it must survive a full vote, merge with a companion version from the Senate Agriculture Committee, and be reconciled with the House text.

With Congress scheduled to leave for August recess in a matter of days, the bill's future remains uncertain. As of Wednesday, no Democrats have gone on record supporting the current version of the bill.