Giancarlo says Democrats may rewrite CLARITY Act and challenge Trump

Giancarlo described a possible strategy for Democrats as they prepare to take control of both congressional chambers on January 3: pass a revised crypto market structure bill, then put the onus on Trump to reject it. “We dare you to veto it,” he said. The approach would require support from lawmakers including Senators Elizabeth Warren and Sherrod Brown, whose views on crypto regulation have often differed from Republicans’.\n\nThe reported Waters proposal would keep roughly 80% of the existing CLARITY Act and use the other 20% for Democratic priorities. House Democrats have discussed giving the Securities and Exchange Commission more authority over crypto while reducing the Commodity Futures Trading Commission’s role. Waters’ earlier Crypto Investor and Consumer Bill of Rights amendment included custody protections, withdrawal safeguards and reserve reporting requirements. Democrats have also discussed provisions covering crypto interests held by elected officials, including Trump and members of his administration.\n\nThe current bill stalled in September, when a procedural motion failed 49 to 50; it needed 60 votes to advance. Seven Democratic senators later showed interest in continuing negotiations, but disputes over ethics provisions and consumer protections remained. Giancarlo warned that negotiations could add restrictions or unrelated proposals, including measures on credit card fees. He compared the prospect to debate around the Dodd-Frank financial reform law and said Trump might then argue the bill was no longer chiefly about cryptocurrency.\n\nGiancarlo expects Democrats to target Trump and his family’s crypto interests more than the industry as a whole, saying a renewed campaign against crypto would be politically difficult after companies operated through regulatory disputes during the Biden administration. He also said the SEC and CFTC have developed a cooperative approach to digital-asset oversight. In his view, the SEC focuses on disclosure and information gaps, while the CFTC handles market integrity, price formation and manipulation. Congress should avoid overlapping jurisdiction and match products to each agency’s expertise, he said. Giancarlo praised SEC Chairman Paul Atkins and CFTC Chairman Michael Selig for coordinating, but criticized unfilled commissioner posts at both agencies, arguing that bipartisan commissions produce better rules.