Trump concedes on crypto ethics rules as the Senate heads for a CLARITY Act vote

President Trump has agreed to a significant portion of a stringent ethics proposal that forms part of a broader cryptocurrency bill headed for the Senate, Republican senators said¹. Senate Republicans released what The Block called a final Clarity Act draft as Trump accepted most of the ethics provisions². That proposal could, in theory, force Trump to divest from ventures such as World Liberty Financial, the cryptocurrency venture his sons launched³.

The draft also touches the USD1 stablecoin and the TRUMP memecoin^2,5. Democrats want the ethics language stronger and aimed at the Trump family’s World Liberty Financial holdings, with a bipartisan counterproposal having circulated in late July⁶.

Why it matters to investors

The revised text adds a circuit breaker to the stablecoin yield section and narrows BRCA protections⁴. It would give the Treasury secretary authority to impose an 18-month circuit breaker on stablecoin rewards⁵ and hands Treasury Secretary Scott Bessent control over stablecoin regulation¹⁰. The bill would also allow state attorneys general to enforce digital-asset bans¹⁰.

Ethics rules were added while an anti-CBDC section was dropped, alongside changes to stablecoin issuer oversight under the GENIUS Act and new protection for developers¹³. Legislation passed last year set up the legal framework giving a stablecoin a common value like dollar bills⁹.

What to watch

Banks are fighting the rewards provision hardest. 77 state banking associations have urged the Senate to amend the CLARITY Act, targeting stablecoin rewards programs such as Coinbase’s USDC offerings^7,8. The focus is on rewards tied to stablecoin balances, which mirror interest-rate products in traditional banking⁸. Small banks, including those in Minnesota, are at the forefront of the battle against the bill⁹.

Prediction-market odds on passage rose above 32 percent after the concession, having reached about 82 percent in February before political disputes intervened¹¹. Coindesk described the bill as suspended between life and death as the Senate returns, quoting Coinbase chief executive Brian Armstrong: ‘If it passes, great, we’ve got legislation’¹². The vote is expected Tuesday⁶.

Two fights are therefore running at once inside the same text. One is about the President’s own holdings and how far a divestment requirement should reach^1,3,6. The other is about deposits, and whether balance-based rewards on stablecoins pull funds out of community banks^7,8,9. The revised draft resolves neither outright; it routes the second to the Treasury secretary’s discretion through the circuit breaker^4,5,10.