SEC and CFTC Step Up Crypto Rules as Clarity Act Progress Slows

SEC-CFTC Crypto Framework Moves Forward as CLARITY Act Stalls

The SEC and CFTC are taking steps to establish clearer rules for digital assets, even as Congress struggles to advance the long-awaited CLARITY Act.

The two agencies recently released joint guidance that divides crypto assets into five broad categories: digital commodities, digital collectibles, digital tools, stablecoins and digital securities.

The framework gives exchanges, token issuers and traders a better indication of how regulators could approach different types of digital assets. However, the guidance remains an agency interpretation rather than legislation, meaning it does not provide the same long-term certainty as rules enacted by Congress.

The development comes as crypto markets await the latest U.S. CPI figures, with Bitcoin consolidating near $64,000. Fresh inflation data could determine whether BTC remains range-bound or makes a larger move.

SEC-CFTC Classification Provides Interim Clarity

Under the new framework, digital commodities, digital collectibles, digital tools and stablecoins generally fall outside traditional securities regulation. Digital securities, meanwhile, remain the category most clearly subject to SEC oversight.

The SEC has also reserved the ability to assert jurisdiction over particular assets that might otherwise be viewed as nonsecurities, depending on the circumstances. That qualification means the framework does not completely eliminate uncertainty.

The remaining ambiguity highlights why lawmakers have been pursuing comprehensive market-structure legislation. The CLARITY Act is intended to establish statutory boundaries between the SEC and CFTC, while the latest agency guidance effectively serves as an interim solution.

Ian Katz, managing partner at Capital Alpha, said regulators are not prepared to completely pause their efforts while waiting for Congress, particularly given how slowly formal legislation can move.

SEC Chair Paul Atkins expressed a similar position at the DC Blockchain Summit, describing the regulatory guidance as an overdue step toward providing the industry with greater certainty.

Atkins has also discussed a broader crypto framework that could include exemptions for startups and fundraising, along with a safe harbor for assets that eventually develop beyond securities treatment. Such provisions would generally require congressional legislation to become permanent.

Senate Debate Continues to Hold Up CLARITY Act

The House passed the CLARITY Act last July, but the legislation has encountered significant challenges in the Senate.

The Senate Agriculture Committee has advanced its portion of the legislation without Democratic support, while the Banking Committee has faced additional obstacles, including the loss of Coinbase’s backing.

Stablecoin rewards remain a major point of disagreement. Banks have advocated tighter restrictions, while crypto companies argue that limiting rewards could make digital assets less competitive with traditional financial products.

President Trump has criticized banks over their approach to the GENIUS Act and has urged lawmakers to accelerate work on broader crypto market-structure legislation.

Senators Angela Alsobrooks and Thom Tillis have reportedly reached a bipartisan understanding regarding stablecoin rewards, although the details of their agreement remain limited.

David Carlisle of Elliptic said the SEC-CFTC interpretation offers some useful reassurance to the market while the legislative process remains unresolved.

What Happens Next for Crypto Regulation?

Advancing the CLARITY Act through the Senate would still require several additional steps. The Banking Committee’s version would have to be reconciled with the Agriculture Committee’s bill before securing the 60 votes needed to advance in the Senate. Lawmakers would then need to reconcile the final Senate legislation with the House-approved version.

The approaching midterm elections could further narrow the window for lawmakers to complete the process, increasing pressure on Congress to reach an agreement.

Sen. Bernie Moreno has warned that failing to pass the CLARITY Act by May could leave comprehensive digital-asset legislation stalled for an extended period.

For crypto investors, the distinction between agency guidance and federal law is particularly important. Regulators can revise or withdraw an interpretation without a congressional vote, whereas legislation provides a substantially more durable regulatory framework.

The SEC-CFTC initiative therefore offers the crypto industry useful short-term direction, but it does not replace congressional action. Until the CLARITY Act or comparable legislation becomes law, regulatory uncertainty will remain an important consideration for crypto markets, institutional investors and digital-asset businesses.