CLARITY Act Gets Trump-Backed Ethics Deal Before Senate Vote

Senate Republicans released another revised CLARITY Act text late Sunday ahead of the Sept. 15 procedural vote. The latest draft includes concessions on political ethics, stablecoin rewards, developer protections and market structure.

Republicans described the package as their “last, best and final” offer to Democrats. President Donald Trump also accepted most of a bipartisan ethics proposal that had remained one of the bill’s biggest sticking points.

The legislation now faces a cloture vote on Tuesday. Republicans need 60 votes to advance the bill, meaning Democratic support remains necessary.

CLARITY Act Gets New Ethics Concessions Before Vote

Senate Republicans have released revised text of the CLARITY Act, including an updated ethics proposal agreed to by President Trump. The latest version also includes changes to provisions covering the Blockchain Regulatory Certainty Act (BRCA), stablecoin yield and the so-called “Ag title.”

Republicans have described the revised legislation as their “last, best and final” offer to Democrats ahead of Tuesday’s cloture vote. Speaking on the development, pro-crypto Senator Cynthia Lummis wrote:

“President Trump voluntarily agreed to new ethics provisions holding every federally elected official, judge, and their spouses to some of the toughest ethics restrictions in U.S. history. This new text includes more than 120 of Democrats’ demands.”

Cynthia Lummis added that a “no” vote on Tuesday would mean opposing ethics reforms targeting politicians’ personal investments. She warned that it could also mean ceding US leadership in digital assets to foreign competitors. Lummis warned that rejecting the new crypto regulations would leave America without protections in the digital asset markets.

What Does the Clarity Act Upgrade Bring?

Under the updated BRCA provision, protections have been narrowed to the Bank Secrecy Act and civil enforcement. Language extending those protections to criminal cases, including prosecutions under Section 1960, has been removed.

Moreover, the revised ethics proposal incorporates what a GOP aide described as “80%” of the Tillis-Gallego proposal. It would require Trump to either divest “substantial” crypto-related financial interests or place them in a blind trust. The proposal would also give state attorneys general a role in enforcing the ethics provisions, which the White House had previously opposed.

Another major focus area has been the stablecoin yield. The revised text of the Clarity Act includes “circuit breaker” language proposed by Tillis in July. The provision would allow federal regulators to intervene if there is any evidence of large transfers from community banks to stablecoins. Treasury Secretary Scott Bessent would serve as the federal regulator overseeing the mechanism.

Besides, the updated “Ag title” also introduces tighter rules around vertical integration. This includes affiliate trading and conflicts of interest involving digital commodity exchanges, brokers and dealers. More importantly, clarifies that state consumer protection laws remain applicable and that developer protections do not exempt entities from derivatives laws or affect prediction markets.

According to data from the prediction platform Kalshi, the odds of the CLARITY Act becoming law this year have surged to 44%, up sharply from just 14% last week. Overall, this could be beneficial for the crypto market.

House Committee to Review Two Crypto Tax Bills on September 16

In addition to the CLARITY Act decision at the Senate, the U.S. House Ways and Means Committee is set to review two crypto tax bills on September 16.

The Mining and Staking Tax Clarity Act would defer taxes on newly generated tokens until they are disposed of. Moreover, it will treat the resulting income as ordinary income. Republicans are reportedly considering removing the deferral provision or limiting it to five years.

The Applying Existing Tax Law Anti-Abuse Rules to Digital Assets Act would extend wash-sale and constructive-sale rules to digital assets. However, assets earned through mining or staking and eligible US dollar-denominated stablecoins would be excluded.

If approved, both bills would proceed to the House floor.

This article is for informational purposes only and does not constitute legal, financial or investment advice. Legislative proposals can change during negotiations and may not become law in their current form.