The US Senate on Tuesday blocked an effort to advance landmark cryptocurrency legislation, as Democratic concerns over ethics safeguards and President Donald Trump’s digital-asset interests prevented the measure from securing enough support.
The Senate voted 49-50 on a procedural motion to advance the Digital Asset Market Clarity Act, according to reporting by The Hill. The measure needed 60 votes to move forward, leaving lawmakers well short of the threshold required to begin consideration of the legislation.
The result followed months of negotiations between Republicans and Democrats over how digital assets should be regulated and, increasingly, how Congress should address potential conflicts of interest involving elected officials with financial ties to cryptocurrency.
According to The Hill, Democratic opposition centered in significant part on whether the legislation contained sufficiently strong ethics safeguards, including restrictions intended to prevent President Donald Trump and other federal officials from benefiting financially from crypto ventures while serving in office.
Republicans had sought to address those objections before Tuesday’s vote. A revised version of the legislation incorporated numerous changes requested by Democratic negotiators and strengthened provisions governing the crypto activities of public officials. Reuters reported ahead of the vote that Republican sponsors said the latest version contained 126 substantive changes sought by Democrats.
The revisions weren’t enough to secure the votes needed to advance the measure.
The legislation would create a broad federal framework governing digital assets and clarify regulatory responsibilities in a market that has long faced uncertainty over the respective roles of US financial regulators. The crypto industry has made passage of market-structure legislation one of its top priorities in Washington.
The dispute over ethics became particularly significant because of Trump’s involvement in digital assets. According to The Hill’s reporting, Democrats argued that Congress should establish stronger protections against presidents and other public officials using their positions while maintaining financial interests in crypto businesses.
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The latest Republican proposal included provisions aimed at restricting crypto-related activities by federal officials and their spouses. Contemporary reporting by Reuters said the revised legislation incorporated an ethics proposal associated with Republican Sen. Thom Tillis of North Carolina and Democratic Sen. Ruben Gallego of Arizona, including a role for state attorneys general in enforcing certain restrictions.
Still, Democrats argued that the protections did not go far enough.
Sen. Elizabeth Warren of Massachusetts, the top Democrat on the Senate Banking Committee and a longtime critic of weak cryptocurrency oversight, said lawmakers needed to ensure that a president could not use public office to enrich himself through digital assets, according to The Hill.
The defeat also underscores the difficulty of assembling a coalition around crypto legislation despite growing bipartisan interest in creating clearer rules for the industry. Republicans control the Senate but needed Democratic support to reach the 60-vote procedural threshold.
Banking-industry concerns added another complication. Reuters reported that banks remained uneasy about provisions governing stablecoins — digital tokens typically designed to maintain a fixed value against the dollar — and the possibility that crypto companies could offer rewards that compete with traditional bank deposits.
Republican sponsors had argued that their latest proposal reflected extensive bipartisan negotiations and addressed many of the objections raised by Democrats. Sen. Cynthia Lummis of Wyoming, one of Congress’s most prominent advocates for digital-asset legislation, said before the vote that Republicans had made extensive concessions in an effort to reach an agreement.
Tuesday’s failure leaves the future of the legislation uncertain as Congress moves closer to the November midterm elections, when the legislative calendar typically becomes more difficult for major bills.
The setback doesn’t end efforts to regulate digital assets. Federal agencies have continued developing cryptocurrency policies under existing law, while lawmakers could revive market-structure legislation through further negotiations or in a future Congress.
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