Federal Agencies Set to Lead US Crypto Regulation Following Midterm Elections
Federal agencies expected to drive crypto policy
Crypto executives expect United States federal agencies to lead the next phase of digital-asset regulation. This shift is anticipated regardless of the final results of the current midterm elections. Experts believe the Securities and Exchange Commission (SEC), Commodity Futures Trading Commission (CFTC), and the Treasury will be the primary drivers of policy over the next few years.
The move toward agency-led regulation comes as major legislative efforts remain stalled in Congress. While the election could impact the future of specific bills, industry leaders say the most immediate regulatory movement is happening within federal offices rather than through new laws.
Key developments in US crypto oversight
- Federal agencies are increasing their engagement with various crypto projects.
- The CLARITY Act, a major piece of crypto legislation, recently failed to move forward in the Senate.
- The SEC and CFTC have already begun introducing new frameworks and regulatory plans.
- Industry leaders are calling for permanent laws to replace temporary agency guidance.
Insights from industry experts
Maylea Ma, deputy general counsel at 1inch, stated that federal agencies will likely provide the most "real movement" in regulation for the foreseeable future. 1inch is a platform that searches for the best prices across different decentralized crypto exchanges. Ma noted that while agencies are talking more with crypto firms, this does not provide the long-term stability the industry needs. She explained that the ultimate goal is a statute, or a formal law, that a new government cannot easily change.
Michael Ho, co-founder of D3, added that the lack of clear laws is keeping institutional investors from entering the market. He believes that serious capital will stay on the sidelines until rules are written into permanent law. Ho specifically mentioned that clear legislation is needed to bring institutional money into tokenized real-world assets, which are physical assets represented as digital tokens on a blockchain.
Confirmed regulatory actions and plans
In August, the SEC proposed a new framework for how crypto projects can raise money. This included certain exemptions and a "safe harbor" from being treated as traditional investment contracts. In September, the agency also updated its guidance for staff regarding token buybacks and staking receipt tokens, which are digital records showing a user has locked up their tokens to help secure a network.
The CFTC also took action by submitting a crypto market regulatory plan for White House review on September 17. This submission occurred just two days after the Senate failed to advance the CLARITY Act. These moves indicate that agencies are moving forward with their own rules while Congress remains divided.
Why the shift to agencies matters
The reliance on agency guidance instead of formal laws creates uncertainty for the crypto industry. Rules created by agencies can often be reversed or changed when a new presidential administration takes office. For the industry to mature and attract large-scale institutional investment, executives argue that the US needs stable, permanent laws passed by Congress.
Sources
Newisty Editorial Team covers technology, cryptocurrency, digital products, online platforms, developer tools and the wider digital economy. Our content is researched from official sources, company announcements, public documentation, market data and other primary or reputable sources. Articles are reviewed and edited before publication for clarity, accuracy and useful context.