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- Senate Republicans released an updated draft of the Digital Asset Market Clarity Act, merging the banking and Agriculture Committee versions into one bill that divides crypto oversight between the SEC and CFTC. President Trump has reportedly agreed to ethics provisions for the Clarity Act after months of negotiations with lawmakers, removing what had been the final major hurdle to advancing the crypto legislation. The main addition versus the May draft is an ethics section barring covered officials such as the President, Vice President, and members of Congress, plus spouses from issuing or sponsoring digital assets while in office, with a blind-trust safe harbor, DOJ enforcement, and a 20-Jan-29 sunset. A new law enforcement section also adds investigative funding and stablecoin seizure authority. The release exposed the bill’s remaining fault lines as a bloc of Democrats seen as necessary for the 60 votes needed to advance the bill said ethics, consumer-protection, illicit-finance, conflicts-of-interest and market-integrity provisions still fall short; a separate group of 12 Democrats objected to the bill’s treatment of prediction markets on tribal-gaming grounds; and banking trade groups opposed the stablecoin-reward language over deposit competition. Lead negotiator Senator Lummis identified the scope of state AG enforcement authority as the central unresolved issue, with that and some illicit-finance provisions still under discussion into the weekend. Majority Leader Thune intends to bring the bill to the floor within weeks, ahead of the Senate’s 7-Aug recess, but Democratic support remains unconfirmed.
- SEC Commissioner Hester Peirce issued a statement on on-chain vaults and crypto lending strategies, clarifying that such structures are not categorically exempt from federal securities law. She noted vaults could qualify as a “common enterprise” under Howey, that vaults holding or allocating into securities could trigger investment company classification, and that on-chain lending arrangements may bear the hallmarks of securities depending on distribution.
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- Nine major institutional Bitcoin stakeholders have formed the Bitcoin Security Consortium, pledging an aggregate $15M over three years to support Bitcoin network security. Founding members include Anchorage Digital, ARK Invest, BlackRock, Block, Blockstream, Coinbase, Fidelity Digital Assets, Galaxy, and Strategy. The Consortium’s primary focus areas are funding existing Bitcoin developers and researchers, and preparing the network for potential post-quantum cryptography threats. Large-scale quantum computing capable of threatening Bitcoin’s cryptography is not considered an imminent risk, though the Consortium views post-quantum preparedness as a meaningful long-term priority.
- SEC and Coinbase reach settlement over FOIA records requests
- Tuesday after President Trump accepted ethics provisions, and Senate Republicans released an updated draft Thursday barring covered officials from issuing or sponsoring digital assets in office. The bid faded into Friday; Democratic support remained unconfirmed and Majority Leader Thune signaled the bill will likely miss its 7-Aug window.
Weekly Washington Update
Michael Cronan
- mike.cronan@etfinsight.net