US Senate Democrats are introducing a sweeping proposal to block presidents, lawmakers, and their families from creating, endorsing, or sponsoring digital assets, in a direct response to growing controversy surrounding the Trump family's crypto ventures.

The move threatens to derail the bipartisan GENIUS Act, the Senate’s first attempt at regulating stablecoins, amid escalating concerns about potential cryptocurrency corruption linked to the Trump administration, as reported by Axios.

According to a report published by Science Direct, stablecoins' market has grown significantly since the launch of the first stablecoin in 2014, reaching a capitalization of over $150 billion by mid-2024. Despite initial fragmentation, the market is now highly centralized, with most stablecoins pegged to the US dollar and issued on Ethereum (the first live crypto auction) by a few dominant players.

Senator Jeff Merkley (Democrat, Oregon) is set to introduce the End Crypto Corruption Act on Tuesday. The bill aims to ban the president, vice president, members of Congress, and their immediate families from issuing any form of digital asset, including meme coins and stablecoins.

Senate Majority Leader Chuck Schumer (D-NY) and Senator Kirsten Gillibrand (D-NY) are co-sponsoring the bill, which was first reported by Axios.

Concerns over Trump-linked stablecoins derail GENIUS Act

In a private meeting last week, Merkley and Senator Elizabeth Warren (D-MA) criticized the GENIUS Act, saying it lacks basic safeguards against corruption, “We need to make sure we fix this in the bill, or else the GENIUS Act will simply facilitate Trump's crypto corruption.”

Trump shouldn’t be allowed to engage in a crypto scheme to sell influence and enrich himself—that’s corruption on full display.

We need to add the End Crypto Corruption Act to the GENUIS Act to stop this behavior from Trump and other elected officials! https://t.co/87XddV2AxT

— Senator Jeff Merkley (@SenJeffMerkley) May 6, 2025

Merkley posted on X, "We need to add the End Crypto Corruption Act to the GENUIS Act to stop this behavior from Trump and other elected officials," while citing a press release statement on his website. 

Democratic support for the GENIUS Act has fractured following reports that members of Donald Trump’s family could profit from a $2 billion transaction involving their stablecoin holdings and an Abu Dhabi-based investment fund, according to Axios.

A Chainalysis report released Monday found that issuers of the "Official Trump" meme coin had already made $320 million from trading fees alone.

Senator Merkley wrote in a “dear colleague” letter that his proposed legislation would directly address this issue and “curb the corruption that the Trump Administration is potentially engaging in.” Schumer has reportedly instructed Senate Democrats to withhold support for the GENIUS Act unless revisions are made to prevent such profiteering.

On the House side, Democratic lawmakers led by Representative Maxine Waters (Democrat, California) canceled a scheduled joint hearing on digital asset regulation. Instead, they held a separate event to discuss corruption risks associated with political figures issuing crypto assets, a move closely aligned with Merkley's legislative goals.

Despite this Resistance, Senate Republicans have signaled they still intend to bring the GENIUS Act to the floor for a vote later this week.