Democrats May Rewrite CLARITY Act and Challenge Trump Veto

Former Commodity Futures Trading Commission Chairman Chris Giancarlo has suggested that Democrats could introduce their own version of the CLARITY Act and challenge President Donald Trump to sign or veto the legislation after taking control of Congress in January.

Speaking in a November 11 interview with Bitcoin Magazine, Giancarlo said he has heard that Representative Maxine Waters intends to retain roughly 80% of the existing CLARITY Act, with the remaining provisions reflecting Democratic priorities. The updated framework reportedly draws on Waters' earlier Crypto Investor and Consumer Bill of Rights amendment, incorporating custody protections, withdrawal safeguards, and reserve reporting requirements.

Potential Legislative Strategy

Giancarlo suggested that the legislative maneuver could allow Democrats to position themselves as supporters of crypto regulation while putting pressure on the White House. According to the former regulator, opposition could focus more heavily on the president and his family's cryptocurrency interests rather than attempting to halt the industry's development entirely, given the political difficulty of a renewed campaign against the sector.

The strategy would require support from prominent Democratic lawmakers, including Senators Elizabeth Warren and Sherrod Brown. The November midterm elections have secured Democratic control of both congressional chambers starting January 3, with Waters expected to lead the House Financial Services Committee and Warren potentially chairing Senate Banking.

Regulatory Jurisdictions and Negotiations

Giancarlo warned that a Democratic proposal could evolve significantly during negotiations if lawmakers attach unrelated policy priorities, drawing comparisons to Dodd-Frank financial reform discussions. Such additions could include restrictions, prohibitions, or proposals concerning credit card fees.

Meanwhile, Giancarlo noted that the Securities and Exchange Commission and the CFTC have already established a cooperative approach to digital asset oversight. He praised the coordination between SEC Chairman Paul Atkins and CFTC Chairman Michael Selig, while emphasizing that Congress should ensure there is no regulatory overlap when defining agency jurisdictions.

Key facts

• Former CFTC Chairman Chris Giancarlo stated Democrats may introduce a revised CLARITY Act after taking congressional control in January.
• Representative Maxine Waters reportedly intends to keep roughly 80% of the existing legislation.
• The CLARITY Act previously stalled in September after failing to advance in the Senate with a 49 to 50 vote.