Trump to Directly Negotiate 'Ethics Clause'... Last-Minute Attempt to Finalize CLARITY Act in Senate

[Mexico City = Shim Young-jae, Correspondent] The CLARITY Act, which aims to fundamentally change the regulatory framework of the U.S. digital asset (cryptocurrency) market, is facing a critical juncture ahead of its final review in the Senate. President Donald Trump is set to engage in direct negotiations with senators, while Ripple's management has publicly urged for the bill's passage, with market observers suggesting that early August is effectively the last golden time for this initiative.

According to CoinGape on the 16th (local time), President Trump is scheduled to meet with senators from both the Republican and Democratic parties to discuss amendments to the ethics clause, which is a key issue in the CLARITY Act. The Senate leadership is also preparing a compromise plan aimed at bringing the bill to a vote by the end of this month.

The Key Variable for Senate Passage: 'Ethics Clause'

The CLARITY Act is a bill that aims to clarify the federal regulatory framework for digital assets. The core of the bill is to delineate the authority for overseeing securities-like assets by the U.S. Securities and Exchange Commission (SEC) and commodity-like assets by the U.S. Commodity Futures Trading Commission (CFTC). The goal is to resolve the regulatory uncertainty that exchanges, token issuers, and blockchain developers have long demanded.

According to CoinGape, the bill was passed in the House of Representatives last July with 294 votes in favor and 134 against. It subsequently passed the Senate Banking Committee in May with a vote of 15 to 9. However, the final vote schedule in the Senate has not been confirmed due to disagreements over ethics regulations and conflict of interest provisions.

Currently, Democratic lawmakers argue that participation in digital asset businesses by the president and high-ranking officials should be more strictly limited. Senators Chris Murphy, Jeff Merkley, and Chris Van Hollen have criticized that public officials should not gain personal benefits from digital asset businesses while in office, and Senator Elizabeth Warren has raised concerns about investor protection, financial stability, and conflict of interest issues.

In contrast, Republicans prioritize the swift processing of the bill itself.

Trump Engages in Direct Negotiations... Ripple Also Publicly Supports

The White House is also directly involved in these negotiations.

CoinGape reports that President Trump is expected to meet with senators to reconcile differences surrounding the ethics clause. Republican Senator Thom Tillis stated, "I hope we can reach an agreement by the end of this week."

Ripple has also publicly urged for the bill's passage.

Stuart Alderoty, Ripple's Chief Legal Officer (CLO), stated on X (formerly Twitter) that "voting against the CLARITY Act would leave the current regulatory gap unaddressed," adding, "We have already experienced the FTX incident. We do not need to see the same movie again."

Lauren Belive, Ripple's co-head of Global Public Policy and Government Affairs, emphasized that "the regulatory gap that allowed businesses like FTX to put customer assets at risk still exists," asserting that the CLARITY Act would address these loopholes.

Hearings on July 17 and Deadline on August 7

The legislative schedule is also tight.

According to CoinGape, Senator Cynthia Lummis anticipates that discussions and reviews of the amendment in the Senate will likely begin between the 20th and 27th after the revised bill is made public.

The most realistic timeline for a final vote is analyzed to be between the 27th and the 7th of next month. Since the Senate will enter a long recess starting August 10, the 7th is effectively seen as the deadline for processing the bill before the recess.

However, if the amendment passes in the Senate, the House will need to go through the re-vote process again. Therefore, it is also suggested that the final enactment of the law and presidential signature may occur after September.

On the 17th, the House Financial Services Committee will hold a hearing titled "How the CLARITY Act Unlocks Innovation in Financial Services." During this session, the competitiveness of U.S. blockchain and strategic Bitcoin reserve-related legislation will also be discussed.

Prediction Market Shows "36% Passage Probability"

The prediction market remains cautious.

According to data from Polymarket cited by CoinGape, the likelihood of the CLARITY Act being enacted as final legislation this year is reflected at about 35-36%. This probability encompasses not only Senate passage but also the approval of identical bills in both chambers and the presidential signature.

However, if the bill actually makes it to the Senate floor or bipartisan agreement is reached, market expectations could rise again. Conversely, if negotiations over the ethics clause break down or fail in procedural votes, the probability could decline once more.

Should the bill ultimately pass, the market expects that regulatory uncertainty for exchanges, stablecoin issuers, blockchain developers, and utility token projects will significantly decrease. On the other hand, the banking sector is concerned that stablecoin reward programs could lead to deposit outflows, and issues regarding developer protection, anti-money laundering (AML), and sanctions regulations are still subjects of last-minute negotiations.

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