Updated CLARITY Act adds crypto bans for US officials

US crypto investors are watching the CLARITY Act because it could shape how digital assets are regulated federally, and the latest Senate draft tries to clear one of the bill's biggest political obstacles.

Released by Senate Republicans on July 22, the updated text would bar the president, vice president, members of Congress, federal judges, other covered officials, and their spouses from issuing or sponsoring digital assets for compensation while in office. It also says those officials must deal with crypto they already own by selling it, placing it in a blind trust they do not control, or using both options. Crypto sales above $1,000 would have to be disclosed.

The draft also keeps protections for developers and infrastructure providers that do not control user funds, while preserving criminal exposure for people who knowingly help illegal transactions. On enforcement, the Justice Department would get civil authority to pursue violations, and exchanges could face action if they knowingly list tokens issued or sponsored in breach of the rules.

Other parts of the bill remain in place, including limits on stablecoin interest-like payments, bankruptcy protections for customer assets, and more tools for crypto crime investigations. Democrats have not agreed to the current language, and no Senate vote has been scheduled.