New CLARITY Act Draft Would Temporarily Ban Federal Officials From Issuing Cryptocurrencies Until 2029

A newly released draft of the Digital Asset Market CLARITY Act includes a temporary ethics provision that would prohibit the President of the United States, members of Congress, senior executive branch officials, and their immediate families from issuing, sponsoring, or promoting digital assets while in office. However, unlike earlier proposals seeking permanent restrictions, the latest compromise would automatically expire on January 20, 2029, a change designed to help secure bipartisan support as the Senate races to pass comprehensive crypto market structure legislation before the August recess.

The revised bill represents the strongest sign yet that Senate negotiators are nearing a final agreement after weeks of debate over ethics provisions, consumer protections, and regulatory oversight. While the temporary restriction addresses one of Democrats’ biggest concerns, lawmakers from both parties are still negotiating additional provisions before bringing the legislation to the Senate floor.

Ethics Restrictions Target Government Officials

The latest draft would temporarily bar senior federal officials from participating in certain crypto-related business activities while serving in office.

The proposed restrictions would apply to:

The President and Vice President.
Members of Congress.
Senior executive branch officials.
Immediate family members covered under the legislation.

The ethics language would prohibit these individuals from issuing, sponsoring, or promoting digital assets during the covered period, though the restrictions would sunset in early 2029 unless extended by Congress.

Temporary Compromise Aims to Break Political Deadlock

Earlier negotiations stalled over whether ethics rules should be permanent or temporary.

The latest compromise:

Keeps ethics provisions in the bill.
Makes the restrictions temporary rather than permanent.
Allows the provisions to expire on January 20, 2029.
Attempts to attract enough Democratic support to overcome the Senate’s 60-vote threshold.

Supporters hope the revised language will remove one of the largest obstacles preventing the legislation from advancing.

CLARITY Act Would Define U.S. Crypto Regulation

Beyond the ethics provisions, the CLARITY Act remains one of the most significant crypto regulatory bills ever considered by Congress.

The legislation would:

Clarify the regulatory responsibilities of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC).
Establish a comprehensive market structure framework for digital assets.
Provide clearer compliance rules for crypto companies operating in the United States.
Create greater legal certainty for institutional investors and blockchain developers.

Supporters argue the bill would reduce regulatory uncertainty that has pushed portions of the crypto industry overseas.

Democrats Continue Seeking Additional Changes

Despite the revised ethics language, several Democratic lawmakers have indicated the bill may still require additional revisions.

Outstanding concerns include:

Consumer protections.
Anti-money laundering (AML) requirements.
Know Your Customer (KYC) provisions.
Enforcement mechanisms.
Remaining ethics questions.

Because the legislation will require bipartisan support to overcome a filibuster, negotiations remain ongoing even after the latest draft was released.

Time Is Running Short

Senate leaders are attempting to move the legislation before lawmakers leave for the August recess.

If the Senate approves the revised bill:

The House of Representatives would still need to approve the Senate version.
The legislation would then move to the President for signature.

With only a limited number of legislative days remaining, negotiators are working under increasing time pressure to finalize the bill.

Industry Watching Closely

The cryptocy industry continues monitoring every revision to the CLARITY Act because the legislation could establish the regulatory framework governing digital assets for years to come.

Industry leaders believe passage could: