Crypto Bill Stalls as Democrats Reject DOJ-Only Ethics Enforcement

Senate Republicans circulated a revised 616-page Crypto Bill draft on July 22 that includes a White House-backed ethics provision, but no Democrat has publicly endorsed the latest text. Senate Majority Leader John Thune said he wants to move the bill to the Senate floor before the August recess, although it remains unclear whether Republicans can secure the 60 votes needed to advance the legislation.

• The ethics provision bars the president, vice president, members of Congress, senior executive branch officials, and their spouses from issuing or sponsoring certain digital assets while in office.
• The provision designates the U.S. attorney general as the primary enforcement authority and does not authorize state attorneys general to enforce the ethics rules.
• The ethics restrictions would expire in 2029 unless extended by Congress.
• Republicans hold 53 Senate seats, meaning they would likely need support from at least seven Democrats if all senators vote.

The ethics language was negotiated between Senate Republicans and the White House and reflects a compromise the Trump administration was willing to support.

Under the proposal, crypto platforms could be required to avoid listing digital assets issued or sponsored in violation of the ethics rules, while the attorney general could pursue civil enforcement against officials and parties that knowingly violate the provision.

For many Democrats, however, the enforcement structure remains the central concern. They argue that relying solely on the Department of Justice provides insufficient independent oversight, particularly given President Donald Trump’s crypto-related business interests. Those concerns intensified after Trump’s annual financial disclosure reported substantial income tied to crypto ventures, including World Liberty Financial and his memecoin-related businesses.

Discover: The Best Token Presales

Sen. Angela Alsobrooks (D, Md.), one of the Democrats who has participated in negotiations on crypto legislation, said this week that any enforcement mechanism limited to the Department of Justice is “an unserious offer.” She added that she could not support the bill under its current ethics language while leaving room for further negotiations before a floor vote.

UPDATE: Sen. Angela Alsobrooks said that the White House proposal to have the DOJ enforce the CLARITY Act’s ethics provisions is an “unserious offer.”

She also said she will not support the bill if it is the only enforcement option, per Eleanor Terrett. pic.twitter.com/Cb0TwfACeR

The main disagreement is over enforcement. Democrats have repeatedly sought to give state attorneys general independent authority to enforce the ethics provisions. The revised Republican draft instead reserves enforcement authority to the U.S. attorney general, preventing states from bringing their own actions under that section of the bill. Democratic lawmakers have argued for months that stronger and more independent oversight is necessary.

A group of Democratic senators, including Alsobrooks, Cory Booker, Ruben Gallego, and Mark Warner, has also said the current CLARITY Act draft remains inadequate on ethics, consumer protection, illicit finance, and market integrity. Their support could prove critical if Republicans hope to advance the legislation.

Discover: The Best Crypto to Diversify Your Portfolio

Thune’s plan to pursue a floor vote before the August recess appears designed to increase pressure on negotiators rather than signal that the bill already has sufficient bipartisan backing. When asked whether the legislation was ready, Thune said he was hopeful but acknowledged that further discussions and possible revisions could still be necessary.

UPDATE: The CLARITY Act is heading toward a Senate vote, even without Democratic support.

Senate Majority Leader John Thune plans to bring the crypto bill to the floor as soon as next week, even if no deal is reached with Democrats, per Bloomberg.

The Senate now has just 12… https://t.co/smqbz9EhuQ

The strategy could force lawmakers to either reach a compromise quickly or publicly demonstrate that bipartisan support remains out of reach. If the bill fails to advance before the Senate leaves for the August recess, negotiations could resume later in the year, although the legislative timeline would become less predictable.

The broader crypto regulation package would establish clearer jurisdiction between the SEC and CFTC, create a regulatory framework for digital assets, and include provisions affecting decentralized finance developers and blockchain infrastructure participants. While Republicans hoped the revised ethics language would attract Democratic support, negotiations remain ongoing, and the bill’s prospects are still uncertain.

Trade Crypto Before The Crypto Bill Passes on Bybit and Get a Chance to Win Our $1,000 USDT Airdrop

The post Crypto Bill Stalls as Democrats Reject DOJ-Only Ethics Enforcement appeared first on Cryptonews.