The House Financial Services Committee's markup of the CLARITY Act — the long-awaited bill that would finally draw the line between SEC and CFTC oversight of digital assets — is scheduled for next week but could collapse before it starts. The holdup: Democrats are conditioning their support on ethics provisions aimed at Trump family crypto ventures, particularly World Liberty Financial. The draft text was circulated May 7 and is being revised, but without a deal, the markup may never happen.
The ethics dispute
Democrats want the bill to include language addressing conflicts of interest tied to former President Donald Trump's family crypto holdings. A congressional Democratic report alleges that deregulation under the Trump administration directly benefited certain crypto firms — including the dissolution of the DOJ's National Cryptocurrency Enforcement Team (NCET) and the halting of investigations into Coinbase, Gemini, and others. The report also cites $11.6 billion in crypto holdings and $800 million in income from digital asset sales in the first half of 2025 connected to Trump family interests.
Sen. Elizabeth Warren made the Democratic position clear on May 7, stating that crypto legislation without safeguards against Trump family-related corruption is “not worth the paper it’s written on.”
What Republicans say
Republicans argue the ethics provisions fall outside the Banking Committee’s jurisdiction. They want to address those issues later in the legislative process, not as part of the CLARITY Act markup. For now, GOP leaders are pushing to keep the draft focused on the core jurisdictional question: which digital assets count as securities and which as commodities.
The timing isn't great. The CLARITY Act has been in the works for months, and a markup collapse would push the debate into election season, where crypto regulation is already a wedge issue.
Committee staff are still revising the text ahead of the scheduled markup. No public deal has been announced. If Democrats hold the line, the bill won't advance — and the fight over Trump family crypto ties will spill onto the House floor, one way or another.
