The Senate’s stalled crypto market-structure push regained momentum Tuesday after the White House reportedly agreed to ethics language covering President Donald Trump, removing one of the biggest obstacles facing the Digital Asset Market Clarity Act.
Coinbase (NASDAQ:COIN) surged 9.5% on the news and helped propel all things crypto after a very dour year for this investing segment. The stock is down from its January high of $256, trading at around $175.80 as of this writing. Cryptocurrency miner Cipher Mining (NASDAQ:CIFR) shares rose 11.4% on the news. But a one day spike due to CLARITY headlines will not be enough in the near-term. The CLARITY Act needs to become law first.
The entire crypto sector is hungry for better news flow, to give speculators a reason to get back into Bitcoin (CRYPTO: BTC). Worth nothing, Bitcoin’s gains were marginal compared to Coinbase and Cipher even as Treasury Secretary Scott Bessent urged Congress to pass the CLARITY Act before they break for summer recess in two weeks.
“A Senate vote before the recess would be a meaningful step toward regulatory clarity,” said Nate Holiday, co-founder of Space and Time, a decentralized, Microsoft-backed Web3 data warehouse. “Our focus is on what comes after the bill passes. We want to see it turning legal clarity into infrastructure that institutions and protocol developers can actually build on in order to demonstrate policy alignment in a way regulators and counter-parties can trust. We’re optimistic,” he said.
No Real Clarity on CLARITY Yet, But Moving in Right Direction
The agreement with the Trump White House was negotiated with Sens. Cynthia Lummis (R-WY) and Bernie Moreno (R-OH) with Moreno saying the Justice Department, rather than blue state attorneys, will be the ones to enforce the ethics provisions.
Moreno is a leading Senator in favor of the Digital Asset Market CLARITY Act (H.R. 3633), widely considered by market players as the landmark cryptocurrency regulation bill following the passing of the GENIUS Act a year ago, which focused on stablecoins. CLARITY passed the House shortly after GENIUS, in July 2025. It is designed to establish clear regulatory rules for cryptocurrency investing and sellers under the auspices of the Securities and Exchange Commission and the Commodities and Futures Trading Commission. CLARITY also sets rules for decentralized finance developers.
“The GENIUS Act was an important first step in securing the dollar’s dominance, but we must capitalize on that momentum if we are going to cement America’s legacy as the crypto capital of the world,” Sen. Lummis posted on X on July 18, adding, “Let’s get the Clarity Act done!”
The Senate text of the bill has not been publicly released yet. Senate Democrats have not reviewed the package. That makes Tuesday’s development a breakthrough and a stock moving story, but CLARITY’s future is not yet clear. Bitcoin opened in the red on Wednesday.
Sen. Elizabeth Warren (D-MA), the Banking Committee’s ranking Democrat and the bill’s most forceful critic, has attacked CLARITY on ethics but also on national-security grounds. On July 8, Warren called the current draft “a ticket to sanctions evasion.” Eight days later, she asked Trump to release updated financial disclosures through July 15, arguing Congress needs accurate information while considering safeguards preventing federal officials from profiting from industries they regulate.
Warren said Trump’s 2025 disclosure showed roughly $1.4 billion in crypto-related income through meme coins and stablecoins, which some have denounced as an “absurd” claim. The new ethics compromise appears designed partly to answer that objection, but its enforcement structure may remain contentious.
Sen. Kirsten Gillibrand (D-NY), also involved in crypto negotiations, previously said the bill would not move without an ethics provision. That was her key obstacle. She has identified consumer protection, illicit-finance safeguards and government ethics as the three remaining issues requiring resolution. One of those obstacles has now seemingly been removed by the White House.
Cryptocurrency Execs and Founders Remain Optimistic
Coinbase recently said the legislation represents “a massive improvement over the status quo,” while policy chief Faryar Shirzad rejected claims that it weakens national security, arguing that covered crypto platforms would face federal anti-money-laundering requirements comparable to traditional banks.
“We want the law to catch up with policy. I think we are getting there. In two more years with the Trump administration, CLARITY is the opportunity to bat down those policy changes into permanent law and I am very confident that we will get there,” Shirzad told “Mornings with Maria” on Fox Business News recently.
Mark Zalan, CEO at GoMining (CRYPTO: GOMINING), said things are moving in the right direction. But getting the bill signed into law is what matters more than directional indicators.
“Regulatory clarity gives builders and businesses more confidence to invest and innovate in the U.S.,” he said. GoMining is a tokenized Bitcoin-mining platform. It lets users purchase exposure to real Bitcoin-mining capacity without buying, housing or operating an ASIC mining machine themselves.
“For Bitcoin, which is more than half of the crypto ecosystem, the bigger regulatory gaps remain unaddressed. Chief among them is tax treatment. Bitcoin is treated as property, every payment is a taxable event, which makes using it as actual money impractical for consumers and merchants alike,” he said, naming at least one item that founders would like to see in the Senate version of CLARITY. He recommends a tax exemption for small transactions, along with clear treatment of self-custody, mining, and non-custodial infrastructure. “I think all of that would do far more to unlock Bitcoin’s utility than market-structure rules alone. I’d like to see those addressed, even in parallel legislation.”
Zalan’s comments might explain why Bitcoin was not a big mover on the CLARITY headlines this week, and was already trading lower on Wednesday morning.
Could Political Headwinds Finally be Weakening?
With Trump and ethics supposedly out of the way, the Senate could move on CLARITY within the next 10 days. This will drive Bitcoin prices, and all things crypto related.
Sen. Lummis promised last week that lawmakers would introduce the Senate version before the August recess. Senate Banking Chairman Tim Scott (R-SC) argued that the CLARITY would move digital assets into a safer, more transparent regulatory system while keeping digital currency innovation in the United States instead of Asia.
The next catalyst for crypto investors will be the visibility on the Senate bill and whether Gillibrand, Warren and other Senate Democrats view the new ethics language as enforceable rather than cosmetic.
If they are satisfied, then a floor vote could follow quickly assuming negotiators lock down the remaining Senate Democrat votes.
“With midterm election campaigning ramping up and the August recess just over two weeks away, the window for passing the CLARITY Act is closing,” said Stefan Muehlbauer, Head of Government Affairs for blockchain security firm CertiK in New York City.
“In such a short legislative calendar, complex financial policy often succumbs to election-year friction, especially as digital asset policy becomes tied to recent campaign rhetoric by Trump,” he said.
Still, lawmakers recognize that federal inaction will not stop the growth of digital assets. Moreover, Silicon Valley, a core donor class for the Democrats, all have money at work in Web3 projects, many of which included cryptocurrencies.
“Foreign jurisdictions, including Europe, the United Arab Emirates and recently Russia, have already enacted statutory frameworks to set market guardrails and protect consumers,” said Muehlbauer. “Delaying the CLARITY Act does not stop crypto; it simply drives capital, talent, and consumers to offshore jurisdictions.”
The writer is an investor in Bitcoin. Cover art created by the author using Canva.
Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been edited for content or accuracy.
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