Major cryptocurrency legislation clears a Senate hurdle, but Democrats hold back support due to missing ‘gryfto’ rules to curb Trump family conflicts of interest
This Thursday, the Senate Agriculture Committee moved forward with legislation that would impose extensive regulations on the cryptocurrency industry—though the vote succeeded solely with Republican backing. The markup process marked a critical hurdle for the bill, known as the Clarity Act, which still needs to clear the Senate Banking Committee before the full chamber can consider it.
During Thursday’s hearing, Democratic senators on the committee expressed disappointment that their Republican colleagues had brought the bill to a vote without bipartisan support. Several members emphasized the need for a conflict-of-interest provision to prevent politicians from profiting off their crypto holdings—a growing concern due to President Trump’s expanding . In a statement shared with , watchdog group Public Citizen referred to the Clarity Act as the “gryfto” bill, referencing Trump’s from the industry.
The bill, set to be the most comprehensive financial reform in decades, faces uncertain prospects in the full Senate, as well as a challenging reconciliation process with the House of Representatives if it continues to advance. Even so, its passage through the Senate Agriculture Committee reflects the blockchain industry’s newly gained influence in Washington, D.C., where it holds a campaign donation war chest of nearly $200 million to spend on the 2026 midterm elections.
A need for Clarity
President Trump, a key ally of the crypto industry, urged Congress to pass two bills shortly after taking office last January. The first, which established guardrails for dollar-backed cryptocurrencies, in July. The more ambitious Clarity Act—designed to set broader market structure rules for cryptocurrency issuance and trading—also cleared the House in July, though it still awaits full Senate support.
The Clarity Act faced its first major hurdle in mid-January when a dispute with the banking lobby over the treatment of stablecoin yields led CEO Brian Armstrong to withdraw his support for the draft. With the bill’s future in doubt, the Senate Banking Committee its planned markup. The Senate Agriculture Committee, which has jurisdiction over commodity-related aspects of the bill, pressed ahead.
While the Clarity Act has garnered bipartisan support (including within the Senate Agriculture Committee), the version debated Thursday was the Republican draft alone. Democrats criticized the bill’s approach to decentralized finance (DeFi) and its lack of robust ethics provisions—issues that have long been non-negotiable for them.
“The White House has made this infinitely harder,” said Sen. Cory Booker (D-N.J.), who leads Democratic negotiations. “It’s ridiculous that the President and his family have made billions from this industry yet are trying to create a framework without ethics rules to stop this kind of gross corruption, which would undermine our democracy.”
An amendment to add an ethics provision failed along party lines.
Despite the absence of bipartisan votes to advance the Clarity Act, Democrats made clear their desire to find common ground. The crypto industry continues to pour money into Washington: Fairshake, the top-funded Super PAC network, announced Wednesday it has $193 million in cash reserves for the 2026 midterms—including nearly $75 million in new contributions from Coinbase, Ripple, and Andreessen Horowitz.
Whether these fresh funds will push the Clarity Act over the finish line remains to be seen. The Senate Banking Committee has yet to reschedule its markup, with Coinbase still at odds with the banking industry over stablecoin yields (a significant portion of its revenue). Pro-crypto lawmakers, however, seemed undeterred.
“We’re at an exciting point in American history,” Booker said Thursday. “Blockchain technology is driving an explosion of innovation right now.”