Trump's Crypto Bill Just Cleared Committee—Here's What It Actually Does

Indexed: 2026-05-16

[00:00:00]got some updated information on how our president is pulling off the biggest heist in financial history. The imalments clause would light itself on fire if it could. The problem is very few people other than one person whom you're going to hear from today. Very few people really understand what's at play here because they're slow rolling it and it's very clever. So, I'm going to read something to you at first to level set on what's already happened, and then you'll hear from the one person who gets it. After that, I'm going to break it all down for you. He's [ __ ] robbing us blind, and we're down to just a matter of months to stop it.

[00:00:41]UND.

[00:00:44]>> The findings uncovered by Bloomberg News show that World Liberty Financial, co-founded by Trump and his sons, is now worth more to the family than any other business, including their stake in Trump Media and Technology Group Corp. or even the famed Mara Lago resort. World Liberty's additional sales of a token called WLFI boosted the Trump family's wealth by 9% to 6.8 8 billion. In total, the 5.9 billion White Glove token sales pushed the Trump family's proceeds up by about 660 million, according to the Bloomberg Billionaires Index. First, the draft in front of us would blow a hole in our securities laws that have protected investors since 1929.

[00:01:31]Second, this bill declares open season on defrauding American consumers who use crypto. The bill wipes out a huge number of state level protections against fraud. Third, the bill puts our financial system at risk by repeating the mistakes of 2008. Fourth, the bill puts our national security at greater risk. And finally, the bill doesn't lift even the tiniest finger to address the Trump administration's cryptoreated corruption. Since taking office last year, President Trump and his family have amassed a staggering $1.4 billion dollar in gains from crypto deals alone.

[00:02:20]>> Thank you, Liz. Senator Elizabeth Warren, by my count at least, is the only person in the US Senate who actually understands what's going on right now and is willing to say anything about it. She filed 44 amendments to the Clarity Act and Republicans killed every single one of them through procedural means. So this week, the Senate Banking Committee voted 15 to9 to advance the Clarity Act out of committee. There were 13 Republicans and two Democrats. Every single amendment on ethics, anti-moneyaundering, and consumer protection rejected or ruled out of order. So the bill is now going to the Senate floor where it needs 60 votes.

[00:03:02]The White House wants a signing ceremony by July 4th, and you'll understand the urgency in a moment. They need to get this done at a minimum though before the midterms. And that's why they refused to engage a single Democratic concern. But to really understand what's going on, we have to go back to where we all started.

[00:03:20]So about a year ago, I did a deep dive on what I called the stable genius, Donald Trump's plan to become one of the central bankers to the world. If you haven't heard it, I'll link it in the notes below.

[00:03:32]I'm going to say it was probably one of the most preient works that we've done on this show. And this you can consider a sequel because since we recorded that piece, two of the three bills that we warned you about have either been signed into law or just cleared a major hurdle to be signed into law. And the third one is waiting in the wings. This is the heist continued. So, let's get to it. A year ago, I opened up that original piece with one word, senior. This is the profit that a government makes by issuing currency. It's the difference between what money costs to make and what it's worth. It's how central banks fund themselves. And I told you that Congress had cleared a path for Donald Trump to capture a meaningful piece of that of seniorage for himself and his family in perpetuity. So, I want to take a few minutes to recap the architecture of what we covered because it's the foundation for everything that's happened since.

[00:04:30]The modern financial system was built at Breton Woods in 1944 where the dollar became the world's reserve currency backed first by gold and then after Nixon in 1971 backed by the credit of the United States. The belief that we would be around that we would honor our debts and that the system would hold.

[00:04:49]And that belief, that trust is what gives the dollar the power. And it's that trust that this current administration is spending down at a remarkable rate, of course, but that's a whole different episode. The point is, whoever controls the currency that the world uses to settle transactions captures a piece of every single one of them. They take a cut forever. That's seniorage. So now we're at the threshold of what I would consider the fourth era, digital tokens tied to stores of value, something called stable coins. And the race to dominate that market, to become the private issuer whose coin becomes the default settlement currency for global trade, is the most consequential financial competition happening right now all over the planet. and that one of the competitors, unbelievably so, is a sitting American president. So, when I first reported on this a year ago, to give you an idea of scale and speed, Tether's USDT was generating roughly $6.4 billion in annual reserve income, and Circle's USDC was pulling in about $1.6 billion. In under a year, Tether has now posted $10 billion in profit for 2025 alone. That's profit. And Circle just reported a $694 million quarter, which puts them on pace for nearly $3 billion annually. Both of those numbers will look tiny in a matter of years as stable coin adoption continues on its current trajectory. So, when the Trump family issued USD1 by World Liberty Financial, they reportedly pocketed $57 million on the launch and they've secured over $2 billion in deals, including a reported arrangement with an Abu Dhabi sovereign wealth fund. Now, Congress is building the regulatory architecture that would legitimize their coin. It would protect their market and eliminate potentially their primary competitor. And that competitor is the US government itself in the form of a central bank digital currency that Congress has effectively already banned.

[00:07:02]So let's take it one bill at a time and I'll walk you through the trilogy of bills. And I want to frame these bills in a way that I think they should be understood not as individual pieces of financial regulation, but a coordinated transfer of power. Three acts of the same play.

[00:07:21]This one already signed into law, the Genius Act, guiding and establishing national innovation for US stable coins.

[00:07:28]So, this one establishes a regulatory framework for payment stable coins. It requires issuers to back their coins one for one by dollar denominated assets, primarily Treasury securities. So, it creates a federal licensing system of sorts. And here's how I'd frame this one. This is the bill that looks out for the treasury. It's not a bad thing. By requiring stable coin reserves to be parked in treasuries, it creates a new captive buyer for US government debt.

[00:07:58]Frankly, at a moment when foreign demand is softening and rates are climbing. So, if you've listened to our work on fiscal dominance, you know why that matters.

[00:08:07]The Treasury always needs buyers and stable coin issuers are now required to be buyers. So there's a public interest rationale that at least you can hold in your hand without dropping it. Now the Genius Act received bipartisan support as it should have because stable coins are a genuine financial innovation designed to lighten up the infrastructure of transactions throughout the global economy and make them more stable, more traceable and all those things. So it was widely supported and I think it's important because we're not alone in this fight. The rest of the world is also racing to create the same type of technology that's just as robust, just as fast, and just as lightweight.

[00:08:52]So, the Clarity Act is the one that just cleared committee this week. And so, if the Genius Act was designed to protect the Treasury, this one is the crypto industries bill. And they'll tell you otherwise, but it is. This is the one that they've been lobbying for the hardest. And there are timing reasons why they're accepting some of the smallest of concessions right now. So after years of regulatory warfare with the SEC, years of enforcement actions, subpoenas, lawsuits, and court battles over whether digital assets are even securities, the industry spent over $200 million in the 2024 election cycle alone to buy its way out from under this framework. And and this week the Senate Banking Committee basically voted to give them exactly what they paid for.

[00:09:38]The Clarity Act draws a jurisdictional line. So most of the crypto market, anything classified as a digital commodity that's tied to a functioning decentralized blockchain moves from SEC oversight to CFTC oversight. Now, the SEC is a disclosure-based regulator with very strong enforcement apparatus and an institutional mandate to protect investors. The CFTC is a call it a principles-based regulator, roughly a third of the size, mind you, and a long history of being very industry friendly.

[00:10:14]And this isn't a technical regulatory distinction. It's a choice about who watches the watchers. and the industry having spent $200 million on the people who make that choice got the answer that it wanted. Now I spent time in the original piece tracing the precedent for this kind of jurisdictional capture. So you might remember remember somebody named Wendy Graham. She was the head of the CFTC from 1988 to 1993 and she was a champion of deregulation who joined the Enron board immediately after she left the government. Now her husband Phil passed the two pieces of legislation that are massively important to us today and in hindsight because of the financial crisis. The Graham Leech Blly act that repealed GlassSteagall and the Commodity Futures Trading Act that moved derivatives another complex dangerous financial instrument from tight oversight to the CFTC. Now, within two years, Enron imploded as we know. Within a decade, the global financial system did the same. And now we're doing it again. We're moving a complex, poorly understood new financial instrument out from under the purview of the most effective regulator we have and putting it in the hands of the CFTC all over again.

[00:11:39]Now, this one is still moving slowly in the background. And as I said a year ago, this one is probably the most important of the three because this is the one that closes the loop for the Trump family personally. The anti-CBDC surveillance act prohibits the Federal Reserve from issuing a retail central bank digital currency ever. Now, the stated rationale for it is privacy, right? the government shouldn't be able to track your digital spending or control your money or turn off your wallet. And what they cite is the Chinese digital yuan, which was integrated with their social credit system. That's the horror story that they invoke. Totally valid. And I'll grant you these aren't hypothetical concerns. A governmentissued digital currency in authoritarian hands is a genuine threat to liberty. that this is the crypto libertarian privacy argument that I'm happy to have because it's a fine discussion, but outside of laundered cash, right now all of our money is traceable. I mean, the only [ __ ] people who get away with hiding money are gangsters and gangster capitalists known as billionaires. So, who are we really protecting here? But here's the bigger problem. Shouldn't the same concern apply to a private stable coin controlled by a small number of unaccountable corporations or let's say I don't know Eric Trump? I mean as it is Tether which is one of the biggest players in the game just moved its headquarters to El Salvador and we're supposed to trust them more than the Federal Reserve. I mean, I know that confidence in the government is low, but come on. When a Fed issued digital dollar is off the table permanently, it clears the field for other stable coins authorized by the CFTC like USD1. And if authorized by the Trump controlled CFTC, World Liberty Financial then becomes a participant in the regulated US stable coin framework. no government competitor, a favorable regulatory regime courtesy of the Genius Act, CFTC oversight courtesy of the Clarity Act, and a family that collects fees on every transaction in perpetuity at a scale that could eventually rival the Federal Reserve's own senior. Think about that.

[00:14:00]Now, let me tell you about the committee vote. The Senate Banking Committee overall has 24 members. There's 13 Republicans and 11 Democrats. The committee chairman is Tim Scott of South Carolina and the ranking member is Elizabeth Warren of Massachusetts. The subcommittee on digital assets is chaired by Cynthia Lumis of Wyoming.

[00:14:20]Now, the ranking Democrat of that subcommittee, the lead Democrat on the committee most directly overseeing this legislation is Ruben Ggo of Arizona.

[00:14:30]Okay, so the vote was 15 to9. Every Republican voted yes and two Democrats crossed over. GGO and Angela Ulsbrooks of Maryland. So, let me tell you about these two and we'll start with GGO. In his 2024 Senate race, he received approximately $10 million in crypto industry support. got $3 million from Fair Shakes affiliate Protect Progress and direct independent expenditures and another seven million from individual donors including Coinbase CEO Brian Armstrong and Andre Horowitz partners Chris Dixon and Ben Horowitz. And he won that race and he was then named the top Democrat on the Senate Banking Subcommittee on Digital Assets, the exact subcommittee overseeing this current markup. Then earlier in the year, GGO held a three-day fundraising retreat at Labour in Sedona with a suggested donation of $5,000 to attend right alongside Mark Andre. Andre of Andre Horowitz, whose firm has invested in over a 100 crypto startups and has contributed $44 million to Fairshake.

[00:15:40]That's the same pack that spent $10 million getting GGO elected. So, we get his complicated factor here, right? But also Brooks is a different story. She co-authored the stable coin yield compromise. It's called the Tillis Also Brooks deal that became a centerpiece of the bill's banking negotiations.

[00:16:00]And I actually I I want to be a little more charitable to her because I understand her position more than Ggo's even though I'm not excusing it because she put genuine work into a compromise and felt a lot of ownership over it. But she still voted no. Chisto voted yes to advance a bill without ethics provisions that every other Democrat, including the ones who support crypto regulation in principle, said were non-negotiable.

[00:16:24]So, nine Democrats voted no, including Mark Warner, who sits on the digital asset subcommittee and, you know, has been one of the more crypto friendly Democrats in the chamber. So, his no vote kind of tells you a lot about the ethics question. He didn't oppose the bill's substance. He opposed the refusal to address Trump's direct financial stake in the outcome. So, we understand that the crypto industry's position is, you know, to win this fight and you can understand what the Fed has to lose in this new stable coin world. But there's another player at the table that has a pretty big voice. And if I'm reading the tea leaves correctly here, that player just got played. The biggest pre-markup battle was over stable coin yield. It's whether crypto platforms could pay interest on stable coin balances. So, let's say you have $10,000 in savings or an interestbearing checking account. The crypto industry wants you to move that money to a digital wallet with stable coins that still money, right? So, you can move those around with fewer fees and you can move it around quickly and it's still still money. In the present scenario, the banks still hold an edge because they can give you interest. So, what the crypto industry did is they decided to call their incentives rewards, but it didn't fool anybody.

[00:17:47]It's interest. And if you think about the potential repercussions of this, it's staggering. So, the banks went to war. The Consumer Bankers Association research shows that bank lending could fall between 65 billion and $1.2 trillion depending on stable coin growth trajectory. The American Bankers Association put the deposit flight risk up around $6 trillion. So this was the fight that nearly killed the bill in January when Coinbase pulled its support and caused the markup to collapse. It was the one issue that drove four months of White House mediated negotiations between the crypto industry and banking trade groups. It was the most covered controversy in this entire Clarity Act story. and the crypto industry I think won it almost completely because the Tillis also Brooks compromise the deal that's now baked into the bill bans what's called passive yield so just holding stable coins can't generate interest but what they do allow is activity-based rewards tied to transactions and platform usage something called staking or account activity and loyalty programs so Coinbase's chief policy officer basically said, you know, hey, the banks were able to get more restrictions on rewards, but we protected what matters, the ability for Americans to earn rewards.

[00:19:10]So, give you a hypothetical. This passes, right? And you make a you have a stable coin wallet and you make one transaction under this bill's language, you can then earn interest on your entire balance just because you made one transaction. So, I think the banks just got rolled because the other big shift in the bill that moves oversight from C the SEC to the CFTC is super important because I think once the CFTC is governing one of the fastest growing sectors in finance, all bets are off and the crypto firms are just going to have their way with regulators like they did in the mortgage crisis because there's not enough of them. There's no way that the handful of employees of the CFTC are going to be able to keep up with the fastest growing part of the financial system. So, here's where we are procedurally. The Senate Banking Committee vote was just the first gate.

[00:20:03]The bill now has to be reconciled with, believe it or not, the Senate Agriculture Committee version, which might seem a little weird, but this is all still in the commodities realm, so they still have a role. Now, those two Senate versions have to be merged into one before a floor vote. And the Senate version then has to be reconciled with the House version, which passed 294 to 134 in July of 2025. It's not going to be a problem. Then it needs 60 votes on the Senate floor. This is where the fight really comes down to. They need 60 votes. They have 13 Republicans as of today's comm as of this week's committee vote, two Democrat yes votes as we know, and they'll need a minimum of seven more Democrats to survive closure. The obvious crossover candidates are my [ __ ] senator Kirstston Gillibrand, who's been pro- crypto for years and predicted that the bill is going to pass in the first week of August, by the way.

[00:20:58]And there's a handful of others from financial services or tech heavy states.

[00:21:03]But the ethics question now becomes the defining variable because Republicans blocked every Democratic amendment on the ethics side of things. Right? So without some concession on Trump family conflicts, the Democrats who might otherwise cross over have no political cover to do so. And Warner made that calculation to be fair. Even senators who are sympathetic to the bill's substance have to answer to their constituents about why they voted to enrich a president's family with zero guard rails. Now, the White House target is July 4th. Gillibrand said August.

[00:21:38]Lumis and Mareno have both said that missing the Memorial Day window could push this to 2030. So, this midterm clock is real. If Democrats make gains in November, the Senate math changes dramatically and that window definitely closes. So, I want to finish this by going back to the ending of the original piece, which I think is maybe even more relevant than when I wrote it. So, I told you the story of Wendy and Phil Graham, the revolving door between the CFTC and private industry, the deregulation of derivatives, the repeal of GlassSteagall, the creation of instruments so complex that the people voting on them just didn't get it. and the catastrophic results Enron and the GFC results mind you that required the Federal Reserve to step in as the lender of last resort to prevent another great depression. So before I even get to the big question, let's think about that lender of last resort piece. We're talking about robbing the Federal Reserve who has to come in during times of crisis as the lender of last resort as their primary from their primary funding mechanism. This doesn't make any sense. And so the big question I asked at the end was, can you spot the difference between these two scenarios, between what Graham did with derivatives in 1999 and what Congress is doing with digital assets now? Moving complex, poorly understood financial instruments from a strong regulator to a weaker, more industry-friendly one with the active financial participation of the people who are making the decisions. The difference this time is that the scale of it is potentially much, much larger.

[00:23:15]We're talking about the global currency system here. And the person at the center of it isn't a trader in Houston working for an energy company. It's the president of the United States of America. And there's only one senator, again, as far as I can tell, that seems to be fighting this thing tooth and nail with everything she's gotten. For all the misgivings I have about Elizabeth Warren's, say behavior to tip the scales against Bernie during the primaries, she is the one person who understands the architecture of this heist because she spent her entire career studying this exact kind of financial regulatory capture. She was in the room for DoddFrank. She built the CFPB from scratch against enormous opposition, mind you. So she knows what happens when private interests capture the regulatory apparatus of money. She filed 44 amendments and they killed every single one of them. So our job right now is to make sure that anyone who needs to know knows. So share this with somebody who doesn't follow this stuff. Send them the original piece. Send them this one.

[00:24:16]Because when the financial historians write about this era, I want it to be absolutely clear that it didn't happen in the dark. They did this thing in the light and we all watched.

[00:24:28]Thanks as always to our members for keeping the lights on and keeping the coffee brewed. We don't have sponsors or advertisers, and we don't gate our content. So, these heroes are the ones to thank for seeing this video.

[00:24:40]>> This is the story of a political pundit who looked at the world around him and just said, "Fuck it." Gives the middle finger to authority and says, "Kiss my ass." But instead of a revolution, he started a podcast. just what the world needs.

[00:24:57]>> Started a podcast.

[00:24:59]>> Another basic white guy who >> started a podcast.

[00:25:02]>> But it's fun because he curses >> all through the podcast.

[00:25:06]>> Unfucking the Republic.