Trump calls for passage of a key cryptocurrency bill as it falters in the Senate: 'We need Congress to take the next step'

By Victor ReklaitisThe Clarity Act is running into resistance because it doesn't limit the president's lucrative crypto venturesPresident Donald Trump speaks to reporters Wednesday by the South Lawn of the White House before hosting a crypto event.President Donald Trump on Wednesday offered support for a stalled bill that's aiming to establish a clearer regulatory framework for cryptocurrencies, with his remarks coming at a White House event featuring key players in the crypto industry."We need Congress to take the next step by passing the Clarity Act - a fair version of the Clarity Act," Trump said. He added that the bill "will keep us ahead of China, keep us ahead of everyone else, will open the door to the next wave of innovations and innovators."One big sticking point for the Clarity Act legislation is Democratic senators' objections to how its ethics provisions handle Trump's lucrative crypto ventures, which earned him $1.4 billion in income last year, according to his annual financial disclosure. They say the bill's provisions should prevent such earnings.Presidents have been exempt from conflict-of-interest rules that prohibit federal officials from having a role in government matters in which they have a financial stake, but Trump's predecessors generally have been careful to avoid sparking ethical concerns. They've relied on blind trusts, divestments or investments in diversified mutual funds and Treasury bills, while Trump has gone full-steam ahead with an unprecedented level of moneymaking ventures that have raised red flags for watchdog groups.Related: Trump's real-estate licensing income in foreign countries nearly doubled - and now features Qatar and RomaniaAnd see: Trump administration backs nuclear fusion - as a company tied to Trump invests in itWith the Clarity Act, Democratic objections prevented Senate passage before the chamber took its August break. A procedural vote is expected on Sept. 15, but the outlook for the bill remains challenging given that Trump's Republican Party only has a Senate majority of 53 out of 100 seats. Prediction markets Kalshi and Polymarket are giving just a 22% chance and a 24% chance, respectively, that the measure will become law this year.Another sticking point is language in the bill that lets crypto companies offer interest-like payments. That's attracted opposition from lobbying groups for banks, which say they're worried it will siphon away bank deposits.Coinbase Global (COIN) CEO Brian Armstrong, Robinhood Markets (HOOD) CEO Vlad Tenev, Ripple CEO Brad Garlinghouse and Kraken co-CEO Arjun Sethi were among the crypto-industry players in attendance at Wednesday's event at the White House.On Tuesday, the Trump administration's Securities and Exchange Commission proposed a new regulatory framework for raising funds through crypto offerings. The move is positive for the crypto industry in general, though it may create more competition for established players, said Jaret Seiberg, an analyst and managing director at TD Cowen's Washington Research Group, in a note."We view this as negative for efforts to enact the Clarity Act, as senators can point to the SEC proposal as a reason why it might make more sense to wait to 2027 to tackle crypto market structure, rather than take politically tough votes on ethics provisions that would apply to the president's crypto endeavor," Seiberg wrote.Bitcoin (BTCUSD) was trading about 5% higher on Wednesday, with its climb above the $68,000 level pinned on a big short squeeze.-Victor ReklaitisThis content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.