Senate Democrats have recently introduced legislation known as the End Crypto Corruption Act in an effort to prevent elected officials from personally benefiting from digital assets while influencing policy. This bill specifically targets sitting presidents, lawmakers, and their families, aiming to bar them from issuing, endorsing, or holding cryptocurrency.
The timing of this legislation is significant as the Senate is set to vote on the GENIUS Act, a stablecoin regulatory framework that could potentially reshape how digital assets are governed in the United States. The surge of USD1, a stablecoin linked to President Donald Trump’s family, reaching a market capitalization of over $2.1 billion has raised concerns among Democratic leaders. They view the End Crypto Corruption Act as a necessary safeguard against potential conflicts of interest during this pivotal moment in regulatory decision-making.
Under the proposed bill, individuals such as the President, Vice President, senior executive officials, members of Congress, and their immediate families would be prohibited from issuing or endorsing cryptocurrencies, as well as financially benefiting from their issuance. Violations of this legislation could result in penalties including fines of up to $1 million and disgorgement of gains.
Senator Jeff Merkley, who introduced the bill, described the current situation as “profoundly corrupt” and emphasized the need to eliminate schemes that allow powerful officials to profit from crypto speculation. Senate Majority Leader Chuck Schumer echoed these sentiments, highlighting how the ability to purchase tokens linked to sitting officials undermines democratic institutions.
The motivation behind the End Crypto Corruption Act stems from Trump’s increasing involvement in the crypto sector, particularly through USD1. The token’s rapid market capitalization growth was fueled by promotional campaigns tied to Trump’s brand, with revenue being directed towards a Trump-affiliated entity. Additionally, concerns have been raised about the upcoming gala dinner for the top TRUMP memecoin holders, where VIP access to the president will be granted to the top 25 holders.
While some members of Congress have expressed reservations about government restrictions on private financial activities, others believe that ethics standards should evolve alongside the expanding role of crypto in finance. The introduction of the End Crypto Corruption Act has added complexity to the GENIUS Act vote, with potential amendments and pushback from GOP senators.
Overall, the controversy surrounding USD1 and the TRUMP memecoin gala dinner has brought conflict-of-interest concerns to the forefront as digital asset regulation reaches a critical juncture. The outcome of these legislative efforts will shape the future of cryptocurrency governance in the United States.