In brief

• The latest Clarity Act draft bars the president, officials and their spouses from issuing or sponsoring crypto while in office, but the provision sunsets on January 20, 2029, and leaves enforcement to the Justice Department—terms likely to draw Democratic objections.
• The ethics fight centers on Trump's meme coins and World Liberty Financial, following disclosures that he earned more than $1.2 billion from crypto last year.
• The bill preserves the Blockchain Regulatory Certainty Act, a safe harbor confirming non-custodial developers aren't "money transmitters."

The latest, and potentially final, version of the long-awaited Clarity Act is circulating in the U.S. Senate, and it now includes the hotly debated ethics provision Democrats have been asking for: restrictions on the president and his family from engaging in cryptocurrency business activities. The ban, however, is written to expire—and wouldn’t place restrictions on President Donald Trump’s sons.

According to the 616-page draft text, the ethics provision would block public officials and employees, along with their spouses, from issuing or sponsoring digital assets while in office. The provision still allows officials to invest in crypto, and the restrictions do not extend to the children of public officials.

Enforcement would fall to the Justice Department, and the section carries a sunset clause stating it will have "no force and effect on and after noon on January 20, 2029"—the end of the current presidential term.

The ethics language has been widely viewed as the final hurdle to passing the sweeping market-structure bill, which would—if passed and signed into law—formally legalize most cryptocurrency activity in the United States.

“Today's draft is a meaningful step toward the Senate vote on the Clarity Act we've been calling for,” Digital Chamber CEO Cody Carbone said in a statement. “We look forward to reviewing the latest, and we will provide our members' feedback on how the bill may still be improved as it moves forward.”

At the center of the current fight over meaningful restrictions on conflicts of interest are President Donald Trump's meme coin ventures and his family's company, World Liberty Financial. Financial disclosures released last month showed Trump earned more than $1.2 billion from crypto businesses last year, which Democrats have cited as evidence of conflicts of interest. Senator Elizabeth Warren has demanded the bill bar the president, vice president, senior officials, members of Congress and their families from profiting off the sector.

The temporary nature of the ban, and the decision to leave enforcement solely with the DOJ, is likely to draw Democratic objections. What’s more, since the language does not cover President Trump’s children—Don Jr. and Eric Trump, who are involved in World Liberty Financial—it may not deliver the full effect Democrats had hoped for. The bill needs 60 votes to clear the Senate, requiring support from at least 10 Democrats, many of whom have already balked.

Apart from the ethics debate, the latest draft also preserves the Blockchain Regulatory Certainty Act, a provision creating a safe harbor for non-custodial software developers by clarifying that they are not "money transmitters" subject to the compliance obligations that designation carries. Much of the crypto industry considers the measure a red line, arguing it provides legal certainty and keeps development onshore. The provision follows Trump-era DOJ prosecutions that sent crypto developers to prison for building privacy tools.

It has drawn opposition, too. Law enforcement groups and a coalition of 82 Catholic leaders have warned the developer protections could weaken safeguards against human trafficking, money laundering, and child exploitation.

Another major point of contention, the matter of so-called stablecoin yield that has drawn the ire of the banking industry, remains unchanged from the previous version of the bill. The language places limits of idle yield, meaning neither stablecoin issuers nor providers like Coinbase would be able to offer rewards solely on stablecoin balances.

Majority Leader John Thune intends to move to floor action in the coming days. With the Senate's August recess approaching, the first week of August is widely seen as the last realistic window for the bill to advance before attention shifts to the November midterms.

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