The U.S. Senate’s crypto market structure effort hit fresh resistance on July 22, when seven Democratic senators said the Republican version of the CLARITY Act still does not go far enough on ethics, consumer protection, and other safeguards. According to CoinDesk, the statement introduced new uncertainty around a bill that had been viewed as close to completion. Earlier this week, Treasury Secretary Bessent said the legislation had reached its final stage.
Democrats identify five areas they want strengthened
The joint statement was issued by Senators Angela Alsobrooks, Cory Booker, Catherine Cortez Masto, Ruben Gallego, John Hickenlooper, Mark Warner, and Raphael Warnock. The group said the Republican text of the CLARITY Act, “in its current form, remains insufficient.”
The senators listed five areas that they said require stronger language: ethics rules for elected officials, consumer protection, prevention of illicit finance, conflict-of-interest provisions, and protections for market integrity. Because the bill needs 60 votes to pass the Senate, Republicans will have to win support from roughly 10 Democratic senators. That makes bipartisan bargaining a decisive part of the process.
Lummis says ethics and illicit finance language will be discussed over the weekend
Senator Cynthia Lummis, one of the bill’s main negotiators, said ethics provisions and some illicit finance provisions “will continue to be discussed over the weekend.” She also said it was time to “show everyone the full integrated version that we are going to vote on.”
One of the main disputes is whether state attorneys general should be able to bring criminal or civil cases against individuals covered by the ethics rules. Lummis said that issue is a “red line” for many senators because they do not want to expose themselves to the risk of being sued. Under an alternative now being discussed, states could instead bring cases against crypto exchanges that list non-compliant assets.
Based on the negotiations, the ethics restrictions would apply to the president, members of Congress, senior federal judges, and their spouses.
Republicans push back as Senate calendar tightens
Republican Senator Bernie Moreno rejected the criticism, saying the bill contains “the strongest ethics provisions in American history,” and added: “Don’t listen to the lies of Washington Democrats.”
The office of Senate Majority Leader Thune had previously said the bill could move forward in the coming days. The Senate is scheduled to begin its summer recess on August 7. If lawmakers want a vote before the break, bipartisan negotiations have less than two weeks left.