Tillis and Gallego Push for Compromise on Clarity Act
The fight is not only about SEC and CFTC oversight, but also about ethics rules tied to Trump and sensitive issues like DeFi and stablecoin interest.
Key Takeaways
- Senators Thom Tillis and Ruben Gallego are working on compromise language for the Clarity Act, especially around ethics rules tied to government officials' crypto ties.
- The text still has to clear the White House and win over enough Democrats, while the Senate is quickly running out of time before the summer recess.
- The bill also includes rules for DeFi, stablecoin yields, oversight between the SEC and CFTC, and tougher consumer protections for crypto companies.
According to people familiar with the talks, the future of the American Clarity Act now hinges on compromise language being drafted by Senators Thom Tillis and Ruben Gallego. The main sticking point is the ethics provision, which is meant to curb direct links between government officials and crypto projects, just as the Senate is heading toward summer recess and the window for a vote keeps shrinking.
New Ethics Language
People familiar with the negotiations say work on that section is now complete, though it is still not clear who has reviewed the latest draft. Before the bill can reach a Senate vote, the text still needs to clear the White House and then attract enough Democratic support to move the Digital Asset Market Clarity Act forward.
The ethics language is especially sensitive because it directly touches on President Donald Trump's crypto activity. Trump recently accepted a narrower version of the proposal, which drew attention across the industry, but Democratic critics argue the arrangement does little to force real compliance. The White House, for its part, described the measure as an unprecedented ethical safeguard aimed squarely at the president.
Time Is Running Out in the Senate
The talks are unfolding under a very tight legislative schedule. With only a few days left before the Senate leaves for summer recess, Majority Leader John Thune has already said the bill likely will not make it through every required step in time. Even so, a first cloture vote this week could still improve its chances.
The Clarity Act is not just about a conflict-of-interest fight. It also covers DeFi, including whether developers should be treated as money transmitters, as well as stablecoin yields, an issue that banking groups are pressing hard on again. The American Bankers Association wants any ban on stablecoin interest to be airtight, with no way around it through rewards or similar structures.
The bill also has to define how regulators such as the SEC and CFTC split oversight of the crypto market. Under the proposed framework, it would also add stricter consumer protections for crypto exchanges, brokers, and dealers. Those rules would cover qualified custodians, the separation of customer funds, and limits on reusing assets without clear permission.
Why This Matters
For European crypto readers, the bigger point is that the U.S. is using the Clarity Act to decide which rules apply to digital assets and which agencies oversee them. A clear outcome could shape how major market players, DeFi projects, and stablecoin issuers approach their U.S. strategy. It also shows how politics, oversight, and market structure in crypto are becoming more closely connected.
The Senate process is also part of a broader picture. In a separate file on the bill, market participants had already warned that the final outcome could influence wider U.S. crypto regulation, from how oversight is divided to how consumer protections are written.
