Senate Rejects 'Dangerously Weak' Clarity Act on Crypto
"The need for responsible cryptocurrency regulation remains," said one anti-corruption advocate.
The US Senate voted not to advance a major cryptocurrency bill on Tuesday, heeding warnings from critics that it would fail to regulate the volatile financial asset effectively and would allow President Donald Trump to continue profiting lavishly from it with little oversight.
Earlier reports indicated that crypto industry darling Sen. Kirsten Gillibrand (D-NY) was trying to rally enough Democrats to support the GOP-led Digital Asset Market Clarity Act to get the 60 votes necessary to break the filibuster.
But by Tuesday afternoon, even Gillibrand herself had jumped ship. In what turned out to be a 50-49 vote against the legislation, she joined every other member of the Democratic caucus to vote against the Clarity Act. So did four Republicans—Sen. Susan Collins (Maine), Josh Hawley (Mo.), Jerry Moran (Kan.), and Thom Tillis (NC).
Democrats who voted against the legislation said that a revised version presented by Republicans on Sunday failed to meet their demands for rules to prevent Trump and other high-ranking officials from profiting from their cryptocurrency ventures while in office.
In 2025, Trump reported roughly $1.4 billion in crypto-related income, including hundreds of millions from his family’s crypto exchange World Liberty Financial (WLF) and from sales of his $TRUMP meme coin.
"President Trump, his children, and his Cabinet are making billions of dollars in the crypto space, in part from bilking everyday Americans out of their hard-earned money," said Sen. Elissa Slotkin (D-Mich.) in a post to social media. "I cannot in good conscience vote for any legislation that codifies that behavior from public officials."
Sen. Ruben Gallego (D-Ariz.), who negotiated the bill's ethics language with Tillis, said in a statement that "instead of spending their time twisting themselves into knots to appease President Trump, Republicans should have worked more closely with Senate Democrats to craft a bill that could pass with strong ethics provisions.”
Reuters reported in August that crypto-aligned super political action committees have spent nearly $190 million during this election cycle to support industry-friendly candidates.
"It’s no secret that they are seeking to ram a bill through Congress based upon not the merits of the bill, but the threat that they will spend even more money in elections against people who vote against it,” said Sen. Chris Murphy (D-Conn.), who voted against the bill.
Ella Fanger, corporate power policy adviser for the progressive activist group Demand Progress, said in a statement that Democrats "dodged a bullet by refusing to go along with the dangerously weak bill that Trump and the crypto industry have asked for," though she questioned why Gillibrand was advocating for the measure up to the last minute, "particularly at a time when she is claiming to oppose Trump's corruption."
The Clarity Act is stalled for now and likely won't be revived until after the November midterms. But Scott Greytak, deputy executive director of Transparency International US, said that "the need for responsible cryptocurrency regulation remains."
"Before bringing it back, Congress must confront two fundamental failures of the legislation," he said in a statement. "First, it must stop President Trump—and future presidents and other public officials—from profiting from the crypto industry while shaping and enforcing its rules. President Trump’s crypto interests make the stakes clear: Public officials who write or enforce the rules for crypto shouldn’t be allowed to cash in on it."
"Second, Congress must ensure that law enforcement can follow the money wherever it moves," he continued. "Unless the bill applies strong anti-money laundering and sanctions rules across the crypto market, scammers, drug cartels, terrorist financiers, sanctions evaders, and corrupt officials will exploit the weakest parts of the system to move and hide their money."
Sen. Elizabeth Warren (D-Mass.), one of the Clarity Act's most outspoken critics, said, “Let’s make sure that we do not pass a crypto bill that will let Donald Trump continue to rake in billions of dollars in crypto profits while working families across this country struggle to deal with higher prices and an economy that gets worse by the day."
