Sen. Tillis Demands Ethics Language in Crypto Bill or Will Vote Against

Republican Senator Thom Tillis said Monday he will oppose the Clarity Act crypto bill if it does not include ethics language, according to Politico. Tillis, a member of the Senate Banking Committee, told the outlet: “There has to be ethics language in the bill before it leaves the Senate, or I’ll go from one of the people working on negotiating it to voting against it.” Investment bank TD Cowen’s Washington Research Group called Tillis the “latest roadblock” to the bill’s passage.

Tillis’s Leverage and the Trump Family Connection

Jaret Seiberg, managing director at TD Cowen’s Washington Research Group, said in a Monday note that Tillis’s ethics demand is “a problem as it likely would apply to the Trump family.” Seiberg added: “We do not see Tillis backing down as he just won a standoff with the President over the Federal Reserve.”

Tillis demonstrated his political influence on Sunday when he announced support for Kevin Warsh as the next Fed chairman after a Justice Department probe into current Fed Chairman Jerome Powell was dropped on Friday. Tillis had previously blocked a vote on Warsh’s nomination due to the DOJ investigation.

Tillis’s Influence Over the Bill

Tillis has been a key negotiator for the crypto bill on the stablecoin yield issue and last week requested that the Senate Banking Committee delay a markup on the bill until May. Seiberg noted that “Tillis has outsized influence over the future of the Clarity Act. And these comments tell us he is willing to use that power.”

Seiberg emphasized that Tillis is not seeking re-election, which may reduce political pressure on him to align with Trump. “This appears to be a legacy issue for Tillis. He wants to ensure government officials, including the President, cannot profit from the crypto sector the legislation would advance,” Seiberg said.

Broader Hurdles to the Crypto Bill

While many in the market expect the bill to pass this year, Seiberg reiterated that major hurdles remain without easy solutions. The ethics or conflict-of-interest provisions are particularly challenging: applying rules only after the next presidential inauguration could avoid impacting Trump’s family, but Seiberg said it is unlikely that Democrats or Tillis would accept that approach. At the same time, imposing restrictions that affect current business interests could be difficult for Trump to accept.

Seiberg previously identified five other hurdles beyond the stablecoin yield issue, including a lack of CFTC commissioners, conflicts tied to the Trump-linked crypto project World Liberty Financial, and concerns around Iran’s use of crypto payments.

Seiberg has stated that passing the bill will likely require personal involvement from Trump, along with compromises that can receive bipartisan support and clear the 60-vote threshold in the Senate. Last month, he said he is “increasingly pessimistic” and sees only a one-in-three chance of the crypto bill passing this year. Earlier, he said the bill could be delayed to 2027, with final rules potentially taking effect in 2029 if hurdles are not resolved this year.

“As with anything political, there can be a deal if there is a desire to find a solution,” Seiberg said. “Our point, however, continues to be that this is not as simple as it may appear. There is still real work on the bill that must get done.”