The Scoop
President Donald Trump’s top cryptocurrency adviser is warning senators that next week could be the last chance Congress gets to accomplish the crypto industry’s top legislative priority — at least, for a while.
“I would say to everyone, Republican and Democrat: Get on the bill and let’s keep talking,” Patrick Witt, executive director of Trump’s Council of Advisers on Digital Assets, told Semafor this week ahead of a procedural vote on the crypto market structure bill next Tuesday. “A failed motion-to-proceed vote doesn’t give anyone anything they want.”
In fact, Witt said, it could mean years before Congress gets another stab at the measure. Crypto firms have long fought for the proposal, which would divide oversight of the industry between the Securities and Exchange Commission and Commodity Futures Trading Commission.
“Who knows,” Witt said, when it might reach the floor again. If Democrats win even partial control of Congress this fall, the bill could see little progress for the rest of Trump’s term given the difficulty of accomplishing anything in divided government.
“The math is highly dependent upon how November turns out with midterm elections,” Witt said. “It’s tough to pass things in a lame-duck period; it’s tough to pass things towards the end of the administration.”
“It’s not impossible, but certainly it gets a lot more complicated,” Witt added.
Republicans and Democrats, whose help is needed to pass the bill, have expressed concerns over provisions related to stablecoin yields and illicit finance. But the biggest holdup is how the measure will rein in Trump’s ability to profit from digital assets after he made more than $1 billion from digital assets last year.
There are “active” discussions, Witt said, about a bipartisan proposal from Sens. Ruben Gallego, D-Ariz., and Thom Tillis, R-N.C., that would go further than one proposed by Republicans, including by forcing Trump to divest his crypto assets and allowing state attorneys general to ensure he complies. But Witt declined to say whether officials have presented any new language to Trump, acknowledging it is “certainly possible” that the president ultimately refuses to make any additional concessions.
“If anyone thinks that … we can’t possibly pass that bill into law unless we have some draconian, state AG-enforced ethics provision — that’s unreasonable,” Witt said.
Those outstanding issues would be “the most natural places” for senators to adopt amendments, Witt said, in order to “get the bill across the finish line.” As for SEC and CFTC nominees that have yet to surface, the White House has “made clear” that it will start that process “as part of getting this bill done,” Witt said.
“If you’re a Democrat, this is a reason to vote for this bill: If you want representation” as the agencies “move forward to write the rules for digital assets within the maximum bounds of authority,” Witt said.
“If it ultimately doesn’t pass, we’ll lick our wounds very quickly, and we’ll turn to the next chapter, which is an impressive rulemaking agenda in both agencies,” Witt, who left the door open to whether his council could dissolve once he takes military leave later this year, said later. He promised “aggressive rulemaking” in the absence of successful legislation.
The View From patrick witt
The following partial transcript of Semafor’s interview with Patrick Witt, executive director of Trump’s Council of Advisers on Digital Assets, has been edited for length and clarity.
Eleanor Mueller: What do you see as the biggest hurdle to passage right now?
Patrick Witt: There are active discussions happening on all of the issues. I spent a lot of my time on the Hill visiting with different Senate offices that have expressed reservations or concerns, trying to resolve those or see if there’s any kind of legislative fixes that can be made to their satisfaction. So I’m optimistic about Sept. 15. It’s obviously a procedural vote. So we’re communicating to folks that even if we can’t necessarily make the change right up front on the front end, the way that you ultimately address the concern that you have is by getting on the bill and then working through the amendment process to get something in there to resolve their concern.
We’ve seen a lot of reporting in the last couple of months, not just about Democrats who continue to have concerns with the bill, but Republicans too. What’s your whip count right now?
I think it’s going to be very strong. If not all 53 Republicans, I think you’re going to be right at that number. So I feel very good about where Republicans are.
Do you think we’ll see amendments on yields?
I don’t want to speak for the leader. I just think from my seat, we’ve had kind of three or four consistent areas where there have either been disagreement on the Republican side or a partisan divide. Those would be the most natural places that I would expect amendments that get the consensus needed to get the bill across the finish line.
Do you anticipate there will be changes to illicit finance moving forward?
You can never say for sure. I’ll be meeting with Sen. [Catherine] Cortez Masto’s office later today to talk about where they are on this. Obviously the law enforcement groups are a major constituency, but the key negotiator on the other side of the table has been Cortez Masto, [D-N.M.].
Where do talks stand over ethics provisions?
It seems to have been somewhat skipped over the fact that the White House, President Trump, agreed to a historic ethics provision already in the bill that restricts all federal officials’ ability to issue or sponsor any digital asset. That’s a big deal for folks that aren’t necessarily experts on government ethics rules — the president, not just this president, but all presidents have been largely exempt from any conflicts of interest rules. Now we’ve continued to talk with Senators Tillis and Senators Gallego about the language that they had worked on. We’re looking at that. We’re seeing if there are any parts of that that could be integrated into the provision that the president has already signed off on.
Has anything been brought to the president since that initial provision?
I’m not going to go into specific conversations with the president, but I can just tell you that it’s actively being discussed internally and I’m in regular touch with the senators’ offices about it.
How are you thinking about this idea that state attorneys general could potentially prosecute presidents over their profit from digital assets?
No. 1, it’s a question of constitutionality. Obviously the country is somewhat evenly divided between red and blue states. A lot of state attorneys general are themselves aspiring for higher office. Federal officials have a job to do. They’re busy individuals. They have official responsibilities. Suddenly state attorneys general are given this opening to harass federal officials of the other party. And again, Republican or Democrat, that’s not a partisan point. It does not seem like a great idea for that to become a tit-for-tat type of opening.
What about this idea of requiring presidents to divest?
In the provision that we have already agreed to, and as the president has said multiple times, a blind trust is a longstanding practice that has been used for any number of officials that come into government with an existing interest. It is especially important to preserve an option like that, that is still very disruptive, but less disruptive than a forced divestment of a potentially illiquid asset for someone that is already in office. Again, there are questions of constitutionality for that.
Do you see a world in which a new ethics agreement is not struck and the White House says the past agreement is the best that we can do?
It’s certainly possible. Ultimately, the president is the ultimate decider on these issues, and so we’ll continue to have the discussions internally, but it’s ultimately the president’s call. Anyone that thinks that, passing a bill to set up a market structure for digital assets, we can’t possibly pass that bill into law unless we have some draconian, state AG-enforced ethics provision — that’s unreasonable. So it’s entirely possible that the provision in there is the one that they’re asked to vote on.
Do you see a world where some of these Democrats vote for the procedural vote, but then not wind up voting for passage?
Honestly, if I were advising them, I would say that’s probably what they should do; they should get on the bill. That’s a lot of the conversations that I’ve had with different senators on the Republican side too: Your concerns for your community banks cannot get addressed if you don’t get on this bill. And for Democrats, your concerns about ethics will not be addressed if this bill fails. So I would say to everyone, Republican and Democrat, get on the bill and let’s keep talking. That’s the way that we ultimately address the concerns on both sides of this, but a failed motion-to-proceed vote doesn’t give anyone anything that they want.
When will we see the White House nominate people to the SEC and CFTC?
We’ve made clear that as part of getting this bill done, there would be an agreement on advancing Democrat commissioners to both commissions. So again, another reason why, if you’re a Democrat, this is a reason to vote for this bill. If you want representation at the different commissions, which have already signaled that they’re prepared to move forward to write the rules for digital assets within the maximum bounds of authority that they have right now, if you want to have an effect on that process, the way you do it is voting for Clarity.
What happens if Clarity does not pass?
Well, you’ve already seen RegCrypto come out of the SEC. That was a big first step. There will be an Innovation Exemption coming from the SEC. Over at the CFTC, there’s a basket of different actions that they plan on taking. Rules are still pretty durable. Nothing is quite like legislation, that’s why we ultimately need to get it passed. But in the absence of that, the regulators will move out on a pretty bold program of different rulemakings within their authorities.
What’s going on with the innovation exemption?
There’s a robust discussion, not just at the SEC, but also Treasury and other agencies, on what exactly that should look like. There’s been a lot of great input that has been provided by industry stakeholders. They’re going to be thoughtful about it.
Does that process get easier once Clarity’s moment on the Hill passes?
Potentially, yeah. We’ll see how things shake out. If it ultimately doesn’t pass, we’ll lick our wounds very quickly and we’ll turn to the next chapter, which is an aggressive rulemaking agenda at both agencies. So either way, there’s clarity coming in a sense. The legislation is the right way to do it. But ultimately in the absence of that, there’s still going to be quite a bit of aggressive rulemaking that will start to set the rules for this market that has existed in this state of regulatory uncertainty for far too long.
When will you take your military leave?
Talking with my commanding officer down in Georgia, we’ll work out when exactly in the next year it makes sense for me to go to that training. I look forward to doing that when the time is right, but I don’t have a firm date just yet.
A lot of crypto’s advocates within the administration have departed recently. Who takes up that mantle, especially once you take your military leave?
It’s a unique thing, this office existing. Normally, these things are handled by the different agencies. So in this current instantiation, I can’t say for sure exactly what that’s going to look like, but I would say even if you were to take this office away tomorrow, we’ve still got tremendous leaders at the different agencies with great connectivity too.
It sounds like you think there’s a possibility the office ceases to exist and this job is given over to the agencies.
I don’t know. I just know that I’ve loved my job. We’re creating what I hope is a long-lasting legacy through this legislation getting passed or ultimately through the rulemakings that are going to happen.
Do you agree with Sen. Cynthia Lummis, R-Wyo., that if Clarity doesn’t pass this year, the next opportunity is in 2030?
I don’t know if I would put a specific date on it. I know that the path is highly dependent upon how November turns out with the midterm elections. It’s tough to pass things in a lame duck period. It’s tough to pass things towards the end of an administration, major impactful legislation. It’s not impossible, but certainly it gets a lot more complicated. So it entirely depends on what your view is of how the midterms will turn out and then the 2028 presidential election. So if I knew the exact answer, I would not be here. I would be placing a lot of positions on Wall Street, but who knows exactly at this point in time? I just know that we have the moment right now.
Have you done any work to prepare for congressional Democratic oversight of how the administration has handled crypto?
I mean, we’ve always conducted ourselves in this office to the highest ethical standards, just knowing that this was a politically charged issue.
Anything I haven’t asked?
I would encourage people to look at [the vote] for what it is, which is a procedural vote to allow us to really continue the process. And if you have concerns about rewards and yield, OK, let’s get on the bill and let’s figure out a solution here and let’s work through it. If you have concerns about the ethics provision, there’s already one in the bill that’s unprecedented and historic. But if there’s more that you want to talk about there, let’s get on the bill and let’s keep talking about it.
Jake Angelo contributed to this report.