Trump Concedes to Stricter Ethics Rules in Push to Advance Major Crypto Legislation

WASHINGTON — President Donald Trump has agreed to accept a substantial portion of a contentious ethics package within a comprehensive cryptocurrency regulatory bill, clearing a major hurdle ahead of a critical Senate vote scheduled for this week, according to key Republican lawmakers.

The breakthrough follows intensive negotiations over the sweeping digital assets measure, known as the Clarity Act, which had previously stalled amid bipartisan concerns regarding potential conflicts of interest. The agreement was confirmed by three of the legislation’s primary Republican sponsors: Sen. Cynthia Lummis of Wyoming, Sen. Tim Scott of South Carolina, and Sen. John Boozman of Arkansas.

Under the bill’s original framework, ethics safeguards were relatively narrow, consisting primarily of a ban that barred all federally elected officials, their spouses, and federal judges from personally issuing digital assets. However, critics argued that such parameters were insufficient given the modern complexities of the digital asset market.

A bipartisan group led by Sen. Thom Tillis, R-N.C., and Sen. Ruben Gallego, D-Ariz., alongside several other Senate Democrats, insisted that the initial language failed to adequately address conflict-of-interest concerns related to Trump’s personal cryptocurrency wealth. Because their backing is vital to securing the necessary votes to advance the legislation in a pivotal Tuesday vote, lawmakers engaged in high-stakes negotiations to bridge the divide.

A central demand from Tillis, Gallego, and their allies was the inclusion of legal authority allowing state attorneys general to step in and enforce the ethics provisions, rather than leaving enforcement solely in the hands of the federal Department of Justice. The trio of lead Republican sponsors affirmed that the newly revised compromise guarantees a meaningful role for state attorneys general in enforcing the legislation if it is signed into law.

A senior Republican aide, speaking on the condition of anonymity during a Sunday night briefing with reporters, indicated that the president consented to approximately 80% of the ethics proposals brought forward by Tillis and Gallego. The aide emphasized that the expanded enforcement powers granted to state attorneys general formed the core of the agreed-upon changes.

Under the updated draft slated for release Sunday night, government officials subject to the measure will be required to either divest or place into a qualified blind trust any significant financial interest held in an entity that issues cryptocurrencies. This requirement aims to eliminate direct personal financial incentives tied to specific token issuers and market-moving decisions.

In addition to enforcing compliance among public officials, the compromise empowers state attorneys general to take direct legal action against cryptocurrency exchanges. Specifically, state prosecutors will have the authority to sue trading platforms if they list digital assets that are explicitly prohibited under the broader provisions of the bill.

The administration publicly signaled its support for the compromise on Sunday evening. Patrick Witt, the White House cryptocurrency adviser, stated on social media platform X that Senate Republicans and the White House have worked steadily to accommodate Democratic policy goals throughout more than a year of continuous legislative talks. Witt stressed that the time has arrived for lawmakers to pass the bipartisan framework.

Despite the public show of unity, the concession on state-level enforcement comes after deep private reservations within the White House. Two individuals familiar with the internal discussions disclosed that administration officials had voiced strong concerns about granting independent enforcement authority to state attorneys general.

White House advisers cautioned behind closed doors that Democratic state attorneys general could potentially utilize the expanded authority as a political weapon against Trump and other Republican figures. Conversely, officials also acknowledged the reciprocal risk that Republican state prosecutors could use the same statutory powers against elected Democrats, creating a volatile regulatory environment across state lines.

Nevertheless, the administration opted to yield ground on the ethics package to protect the broader cryptocurrency legislation’s prospects in the Senate. With the crucial procedural test looming on Tuesday, leadership determined that securing the support of Tillis, Gallego, and undecided Democrats outweighed the risks associated with multi-jurisdictional enforcement.

Representatives for Tillis and Gallego did not immediately respond to requests for comment late Sunday night following the announcement of the agreement.

As Senate leaders prepare to unveil the modified bill text, the coming days will test whether the newly added conflict-of-interest safeguards and divestment mandates are sufficient to solidify a winning bipartisan coalition and bring long-debated federal regulations to the cryptocurrency sector.