Democrats push back on Crypto legislation amid Trump ties and corruption concerns

Washington, D.C. — A bipartisan effort to regulate cryptocurrency is facing serious turbulence in the Senate, as Democrats mount a strong resistance to the GENIUS Act—legislation designed to create a regulatory framework for stablecoins. The opposition, fueled by concerns over former President Donald Trump’s financial ties to the crypto industry, threatens to derail what would be a landmark move in digital finance regulation.
The GENIUS Act, which aims to bring oversight to stablecoins—digital currencies pegged to the value of assets like the U.S. dollar—initially received support from both parties when it passed out of the Senate Banking Committee in March. However, recent developments have prompted a shift, especially among Democrats. A multibillion-dollar investment deal between an Abu Dhabi-backed firm and World Liberty Financial—a cryptocurrency firm with direct ties to the Trump family—has sparked renewed scrutiny.
According to reports, the foreign investment includes a $2 billion purchase of a stablecoin issued by World Liberty Financial. That currency is expected to be funneled into the global exchange Binance, further entangling U.S. crypto ventures with international interests. The timing and scale of the deal have alarmed Democratic lawmakers, who fear it could allow the Trump family to personally profit from laws they once influenced—or may influence again.
In response, Democrats are now demanding robust guardrails. Their key demand: a legislative ban on crypto trading and investment by elected officials and their immediate families. This push includes a proposal from Senate Minority Leader Chuck Schumer, who has urged Democrats not to support the GENIUS Act unless such provisions are added.
“There is growing concern that Congress is drafting laws that could drastically affect the value of crypto assets, while some elected officials—or their families—might benefit financially,” said Senator Elizabeth Warren of Massachusetts. As the leading Democrat on the Senate Banking Committee, Warren has circulated a memo warning that the bill, in its current form, lacks adequate safeguards against corruption, consumer abuse, and national security threats.
Warren's proposed solution includes barring politicians and their families from participating in any stablecoin-related business activities. “The public deserves to know that no lawmaker, including the President of the United States, is writing financial rules to line their own pockets,” she wrote in the memo.
Her concerns echo those of Senator Jeff Merkley of Oregon, who on Tuesday introduced the End Crypto Corruption Act. The bill would prohibit the president, vice president, senior members of Congress, and high-ranking federal officials from profiting off crypto investments. “This is a profoundly corrupt scheme,” Merkley said. “It endangers our national security and erodes public trust in government.”
The bill is already gaining traction, with ten Senate Democrats—including Kirsten Gillibrand of New York and Angela Alsobrooks of Maryland, both original GENIUS Act supporters—signing on as co-sponsors.
Meanwhile, independent Senator Bernie Sanders of Vermont is planning to host a roundtable discussion with crypto experts to examine the risks the GENIUS Act could pose to the broader U.S. economy. Critics fear that, without stringent ethical boundaries, the bill could unintentionally empower corrupt practices under the guise of digital innovation.
Driving much of the skepticism is the explosive growth in the Trump family's crypto wealth. A recent financial disclosure revealed that nearly 40% of Trump’s net worth—about $2.9 billion—is now tied to digital assets. His crypto empire includes meme coins like $TRUMP and $MELANIA, and a large stake in World Liberty Financial, which launched in late 2024.
The White House has denied any conflict of interest. Press Secretary Anna Kelly stated that President Trump’s assets are “held in a trust managed by his children,” and defended the administration’s position: “Stablecoin legislation should be passed on a bipartisan basis. President Trump is committed to making America the crypto capital of the world.”
World Liberty Financial also defended the Abu Dhabi deal in a statement, calling it the “single largest-ever investment in a crypto company” and a “historic precedent.” The firm declined to comment on how much the Trump family stands to gain financially from the arrangement.
Adding to the growing chorus of concern, Senator Richard Blumenthal of Connecticut has requested records and internal communications from both World Liberty Financial and Fight Fight Fight LLC—the company behind Trump’s meme coins. His letters seek to uncover any links between these firms, the Trump Organization, and foreign governments.
With a critical procedural vote on the GENIUS Act looming later this week, the future of crypto regulation hangs in the balance. Senate Majority Leader John Thune of South Dakota, a Republican, has expressed a willingness to discuss potential amendments, but emphasized the need for progress. “We need to start moving forward,” he told reporters on Tuesday.
Whether that forward motion includes stronger ethics rules—or stalls under the weight of political mistrust—remains to be seen. One thing is clear: the intersection of cryptocurrency, politics, and personal profit is drawing sharp lines in the Senate, and the outcome could reshape the future of America’s digital economy.
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