Why Trump Backed Tougher Ethics Rules in Clarity Act, and Why the Crypto Industry Thinks It Can Pass

The odds of the Clarity Act becoming law this year have surged, with prediction market data indicating a 30% chance on Polymarket and 64% on Kalshi. The revised version of the bill, known as the Clarity Act, includes over 120 changes aimed at addressing ethics concerns related to cryptocurrency assets. The legislation would establish a framework to integrate more crypto assets into mainstream finance.

Senate Republicans passed the updated bill on Sunday night, needing at least seven Democratic votes to meet the 60-vote threshold required for a procedural vote. The act would permanently bar officials, including the president, vice president, and members of Congress, from creating or sponsoring digital assets in exchange for payment.

Additionally, officials with substantial equity in crypto-related companies would need to divest or place holdings in a blind trust. Sen. Cynthia Lummis, a strong supporter of crypto in Congress, expressed satisfaction with the inclusion of these new ethics provisions, which were approved by President Trump. The bill eliminates a proposed expiration date for conflict-of-interest restrictions, making them permanent, and would allow state attorneys general to bring civil cases against officials who violate them.