The CLARITY Act Keeps Stalling at the Last Step

I have covered this bill several times before. Each time, it feels like the industry is one vote away from clear rules, and each time something new blocks it. The Senate Banking Committee has already approved it, the House passed its version earlier, and at one point the bill looked like it had over 70 percent support. Then the final floor vote failed again.

This month, the new obstacle came from a news report about President Trump's own crypto earnings. That disclosure turned the bill into a much messier political fight.

The $1.4 Billion Disclosure and the Memecoin Wreckage

The financial disclosure showed that Trump-linked crypto projects generated more than $1.4 billion in 2025. According to the public data, the money came from two main streams. One is World Liberty Financial, or WLFI, a crypto wealth platform. That platform reportedly gives Trump up to 75 percent of revenue, which is an unusually high share even by this industry's standards. The other stream is the Trump memecoin, which generates platform fees and royalties.

The memecoin numbers are brutal. About 980,000 buyer wallets lost a total of $3.8 billion. The price fell from an all-time high around $75 to about $1.50 now, a decline of 97 percent. I rarely promote memecoins, and this case shows why. These projects reward insiders and large names who get in first. That first-mover advantage is a common memecoin disease, and the data here makes it impossible to ignore.

A Conflict-of-Interest Clause Built as a Shield

Because that data became public, the CLARITY Act added a provision meant to address conflicts of interest. It was published on July 22 and initially looked serious. The clause would prevent public officials and their spouses from issuing or endorsing tokens. But when you read the details, the protection is mostly symbolic.

  • Enforcement power sits only with the Department of Justice. State attorneys general and local prosecutors have no authority to sue under this law.
  • The DOJ's power automatically expires after Trump's current term. The next administration would have no legal basis to enforce it.
  • The clause only covers direct issuance by officeholders and family members. Third-party companies can operate freely, so as long as the person is not personally signing the paperwork, almost anything goes.
  • Projects that existed before the clause, including their sales and usage, are grandfathered in. The Trump coin can keep minting and keep collecting royalties without stopping.
  • Holding digital assets is not illegal. Using official power to shape crypto policy is not treated as influence either.

If the Bill Passes: CFTC Takes the Wheel

If the CLARITY Act finally passes, the Commodity Futures Trading Commission would get exclusive jurisdiction over spot digital commodities. Bitcoin and Ethereum would finally step out from under the SEC enforcement cloud. For American investors, putting digital assets into retirement accounts would no longer face the same legal barrier. That is a real bullish signal for BTC and ETH.

Stablecoins would split into two tracks. Projects with a new federal license, like USDC and USD1, would operate more smoothly. Overseas stablecoins without that license would face a much harder time. Altcoins and DeFi protocols would bear high compliance costs. Tokens with no real business model, the ones that only tell stories, would lose liquidity and many would fade away. Centralized exchanges in the US would also need CFTC registration. The era of regulatory arbitrage would largely end.

If It Stalls Again: Money Waits, Jurisdictions Move

If the bill keeps dragging or dies completely, Bitcoin and Ethereum would stay neutral to slightly bearish. Executive orders can create some short-term optimism, but institutional money will remain on the sidelines because the law is still unclear. Stablecoins would stay in their current limbo: some issuers keep offering high-yield products, but trust is fragile and the SEC could act at any time.

Altcoins and DeFi might still see short-term speculation, but large institutional capital will not enter. Meanwhile, the European Union's MiCA framework is fully implemented, and Hong Kong has mostly issued its stablecoin and Web3 licenses. If the US keeps delaying, serious projects with real funding and real teams will simply build elsewhere. Galaxy Research has already cut the probability of passage this year from 75 percent to 60 percent. Congress is about to go on recess, so the Senate's window to act is very small.

The Real Blockage Is Political, Not Technical

The CLARITY Act has stalled again because Trump's crypto earnings turned a technical bill into a conflict-of-interest fight. The disclosure shows over $1.4 billion in linked revenue, a 97 percent memecoin crash for small wallets, and a clause that protects more than it restricts. If it passes, the CFTC gets clear authority. If it stalls, institutional money waits and other jurisdictions move ahead. The next Senate vote will tell us which path the US picks.