Ultimately determining the fate of the CLARITY Act may not be how much Trump concedes, but whether the differences between both sides can be narrowed to a mutually acceptable range before Congress recesses.

Written by: Conflux

On July 21, sources revealed that U.S. President Trump has agreed to include ethical clauses regarding conflicts of interest related to digital assets for the president and federal officials in the CLARITY Act (Digital Asset Market Structure Act). The White House is pushing the Senate Democrats to accept this agreement, but the specific concessions have yet to be made public.

Reports indicate that the text of the ethical clauses was delivered to some Republican senators on the afternoon of July 20, but the Democrats had not seen it at that time. The Democrats' votes are crucial for the advancement of the bill.

"The Strongest" or "Too Lenient"?

Republican Senator Bernie Moreno told CNBC that Trump has accepted what he described as "the strictest ethical language in American history," calling it the strongest piece of legislation in Congress. The White House has not disclosed the specific content of the concessions.

However, the Democrats' assessment is almost the opposite. Senator Ruben Gallego—one of the Democrats most deeply involved in these negotiations—has publicly criticized the terms proposed by the Republicans as being too lenient. Senator Cory Booker took a more cautious tone, stating that the only path to truly accomplish this is through bipartisan negotiation.

The Republicans want a framework that Trump can sign and that can be defended externally; the Democrats, especially those deeply involved in negotiation, want a set of rules that can genuinely hold accountable and plug the loopholes.

"Corruption" Allegations

On July 14, Senator Chris Murphy and others, including Chris Van Hollen, held a press conference in Washington, publicly characterizing this version of the bill as a "corruption" bill. Murphy's exact words were that if this mechanism cannot prevent Trump from corrupting the entire industry, then this bill is worthless.

The "corruption" Murphy referred to targets a specific structural conflict of interest red line: the ethical clause must prohibit senior officials from holding or profiting from digital assets that they are supposed to oversee.

This red line is inescapable because Trump's own financial dealings are too glaring. According to the Trump 2025 Annual Public Financial Disclosure released by the U.S. Office of Government Ethics, his total income for 2025 is at least $2.2 billion, with about $1.4 billion coming from his family's cryptocurrency business. This disclosure quickly became a crucial basis for the Democrats to push for ethical clauses.

Trump's camp claims that the relevant assets have been placed in a family trust, with him not participating in specific decisions—but the Democrats believe that this explanation is less persuasive in light of the fact that "the president remains the ultimate beneficiary."

Implied Pressure

This time, Trump has cleverly taken control of the narrative. Reports indicate that his administration's public stance is that they have "done their utmost" to address the Democrats' concerns, suggesting that if the bill ultimately fails to advance, the responsibility lies with the Democrats.

This is seen by outsiders as a way for the White House to increase negotiation pressure: first showing concessions, then attributing subsequent resistance to whether the Democrats accept it. The window for the Democrats to express their position is indeed limited—if the senators cannot pass the bill within the next three weeks, most analysts believe it will be difficult for it to clear before the midterm elections. The Senate will recess in the first week of August, after which the Congressional agenda will be entirely taken up by the midterm elections.

"Last Struggle" Before Recess

For the institutions and practitioners involved, this tug-of-war surrounding the president's own conflicts of interest is increasingly resembling an extra political tax—issues that the bill should address, such as the regulatory division between the SEC and CFTC and the legitimacy of market structure, have all been sidelined, waiting for both parties to first solve the question of "who can make money from crypto."

When the bill text will be finalized, and whether the Democrats will ultimately agree to this deal, remain unanswered. But one thing is clear: ultimately determining the fate of the CLARITY Act may not be how much Trump concedes, but whether the differences between both sides can be compressed to a mutually acceptable range before Congress recesses.