Investment bank TD Cowen: If Trump agrees to fill the Democratic vacancies at the SEC and CFTC, the progress of the "CLARITY Act" could be effectively advanced.

BlockBeats News, February 18 — Investment bank TD Cowen stated that filling the Democratic vacancies at the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) could help advance negotiations on the U.S. crypto market structure bill.

The investment bank pointed out that the biggest obstacle to passing the bill is not its core framework (i.e., whether digital assets should be regulated as securities by the SEC or as commodities by the CFTC), but rather a political dispute over conflict of interest rules.

Democrats are pushing a ban to prevent senior government officials and their families from engaging in certain financial transactions involving digital assets. TD Cowen noted that, given Trump’s involvement in the crypto project World Liberty Financial, this proposal would involve Trump and his family. Bloomberg estimated last month that Trump has profited approximately $1.4 billion from his crypto projects. The Trump family also holds a 20% stake in mining company American Bitcoin.

According to TD Cowen, it is unlikely that Democrats will abandon this demand, as they have used Trump’s crypto holdings as campaign material ahead of the midterm elections. Last month, in a Senate Agriculture Committee vote on a bill, no Democratic senators voted in favor, citing concerns over Trump’s crypto projects. It remains unclear whether Democrats will support the Senate Banking Committee’s bill.

TD Cowen stated that Republicans oppose the proposal because they believe Trump would veto any legislation requiring his family to divest their crypto holdings. The report added that, even as industry groups continue negotiations on the crypto regulatory framework, this disagreement has caused a political deadlock.

One possible path forward is a bipartisan compromise. In this scenario, Trump would agree to fill the Democratic vacancies at the SEC and CFTC. In return, Democrats would accept conflict of interest provisions that would only take effect after the next presidential inauguration.