Ethics remain a sticking point as crypto market structure bill goes to markup

With lawmakers on the US Senate Banking Committee set to consider a markup on a cryptocurrency market structure bill this week, some Democrats are holding the line — and potentially their votes — on ethics provisions.

The Digital Asset Market Clarity Act (CLARITY), passed by the US House of Representatives in July 2025, is scheduled for a markup in the Banking Committee on Thursday after months of delays due to concerns about language on stablecoin yield, tokenized equities, ethics and more issues related to the crypto industry.

Although the Senate Agriculture Committee passed its version of the bill in a January markup, the legislation must pass through both panels to address different aspects of securities and commodities laws.

“Negotiations continue to be positive, and I remain confident we can get a bipartisan bill over the finish line this Congress,” Senator Kirsten Gillibrand told Cointelegraph. “Americans deserve a well-regulated market with strong consumer protections and real ethics reforms so politicians can’t cash in on their insider status for personal gain.”

Earlier this month, Senators Thom Tillis and Angela Alsobrooks, both of whom sit on the banking committee, announced a compromise deal on stablecoin yield that could allow the CLARITY Act to move forward after months of delays. However, New York's Gillibrand said that even if the bill were to pass the banking committee, her fellow Democrats would not vote in favor of CLARITY without an ethics provision to deal with potential conflicts of interest by members of Congress, elected officials and the US President and Vice President.

Prediction market sentiment on CLARITY Act passage. Source: Polymarket

Related: 7 Democrats seen as ‘key’ to advancing CLARITY Act: Galaxy

Even before taking office in January 2025, US President Donald Trump had close ties to the industry, through the launch of his memecoin Official Trump (TRUMP) and his family’s crypto business, World Liberty Financial. Forbes reported that the president’s personal fortune had increased by about $1.2 billion as of July 2025 due to his crypto ventures. 

Full steam ahead for some Republican lawmakers

Senator Tim Scott, the Republican who chairs the banking committee, said that concerns about the president’s crypto ties were outside the body’s purview for markup and needed to be addressed by the ethics committee before any potential floor vote in the chamber. Tillis, also a Republican, said in April that he would not support any bill without “a bipartisan agreement when it comes to the ethics provision.”

Cynthia Lummis, Wyoming's junior senator who has led the charge on the bill in the Senate and will be retiring in 2027, has urged lawmakers to vote for CLARITY on Thursday.

Source: Cynthia Lummis

“I’m hopeful, given that there seems to be so much momentum from the Democrats, from the Republicans saying ‘hey, we’re ready to get a deal to get this done’ that they can resolve ethics and that it won’t hold this up,” Cody Carbone, CEO of crypto advocacy organization The Digital Chamber, told Cointelegraph. “Ethics has to be tackled on the floor, it’s not within the jurisdiction of the Senate Banking Committee, so I don’t expect it to hold up the markup.”

Even if the bill were to advance in the banking committee and get the 60 votes needed to pass in the Senate, CLARITY would likely need to return to the House for both chambers to pass a reconciled version before it could go to Trump’s desk to potentially be signed into law.

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