US Regulators Move Ahead on Crypto Without Congress

Key Takeaways

The White House shifts the immediate work to regulators

White House crypto adviser Patrick Witt said on September 22 that the SEC and CFTC would continue advancing digital-asset policy rather than wait for Congress to reconsider market-structure legislation after the midterm elections.

Witt acknowledged the weakness in that approach: agency actions taken without new legislation could face legal challenges. Treasury’s Luke Pettit described congressional support as “incredibly chilled,” according to the CoinDesk report.

The comments followed the Senate’s failure to advance the CLARITY Act. As Coindoo reported after the vote, the bill did not receive the 60 votes required to proceed.

That defeat did not end Washington’s crypto agenda. It changed the route: exemptions, guidance and rulemaking will now carry more of the immediate workload, even though Congress remains responsible for establishing a comprehensive legal framework.

The SEC has already taken the first concrete step

The policy shift is not limited to speeches. On September 17, the SEC introduced temporary, conditional relief for certain venues trading tokenized US stocks and for qualifying liquidity providers.

As explained in our analysis of the SEC’s tokenized-stock exemption, the measure creates a controlled route for blockchain-based trading rather than the comprehensive market structure that the CLARITY Act would have established.

The five-year exemption allows qualifying Tokenized Securities Venues to operate without registering as national securities exchanges, provided they meet its conditions. It also gives specified liquidity providers relief from dealer-registration requirements.

The exemption does not suspend securities law. Antifraud and anti-manipulation provisions still apply, while participating venues must meet requirements covering sanctions compliance, access and shareholder rights. Companies can also object to tokenized versions of their shares being traded.

Selig’s CFTC agenda points toward tokenized markets

Hours after Witt described the agency-led route, CFTC Chair Michael Selig outlined the type of market infrastructure he wants the existing regulatory framework to accommodate.

In official remarks delivered at the US Treasury Market Conference, Selig said regulators should prepare for what he called “mass tokenization,” along with onchain finance and potentially continuous markets.

He also stated that the remarks represented his own views as chairman and did not necessarily reflect an approved position of the full Commission. The speech established a direction; it did not adopt a new rule or authorize a new product.

Tokenization across more asset classes

Tokenization places a digital representation of an asset or its economic rights on a blockchain. Whether the token gives its holder legal ownership depends on the product’s structure and governing documents.

Selig said blockchain technology could eventually support tokenization across all asset classes. That would change how some assets are recorded, transferred or settled, but it would not remove the laws attached to the underlying instrument.

A tokenized Treasury security, for example, remains a Treasury security. Moving its record onto a blockchain does not eliminate the legal responsibilities surrounding custody, ownership and trading.

Stablecoins used as derivatives collateral

Collateral is an asset posted to support a leveraged position. If selected stablecoins qualify, market participants could move collateral between approved accounts outside ordinary banking hours.

Selig said the CFTC had expanded its list of eligible tokenized collateral earlier in 2026 to include certain payment stablecoins issued by national trust banks. The agency is considering additional ways to support stablecoin use by regulated participants, exchanges and clearinghouses.

This does not make every stablecoin eligible collateral. The treatment applies only to qualifying products and market participants operating under the relevant conditions.

Near-instant settlement and collateral movement

Traditional transactions can leave cash and assets in transit while banks, brokers and clearing organizations update separate records. Onchain infrastructure could shorten that process and make approved collateral easier to move between participants.

Faster settlement does not remove operational risk. Firms would still need controls for private keys, transaction errors, network outages, sanctions compliance and disputed transfers.

Possible 24/7 trading for selected markets

Selig said crypto and precious metals may be suitable for continuous trading, while agricultural, energy and some financial products may not be. The CFTC has requested public feedback and issued operational guidance, but it has not ordered exchanges to adopt round-the-clock trading.

Any expansion would require surveillance, margin systems and operational safeguards capable of functioning continuously.

Not every regulatory statement carries equal weight

Why the faster route carries more legal risk

Congress can define new regulatory categories and decide where SEC authority ends and CFTC authority begins. The agencies must work within powers already provided by existing law.

That makes the regulatory route faster but narrower. An exemption can remove a specific obstacle without requiring another Senate vote, while a rule can clarify how an existing statute applies to new technology.

Agency action can also be challenged over whether the regulator remained within its statutory authority and followed the required process. Guidance and temporary relief may be revised by future leadership more easily than an act of Congress can be repealed.

This does not make agency action ineffective. It means companies may receive permission to proceed without receiving permanent certainty that the framework will remain unchanged.

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What to watch instead of relying on speeches

The next document matters more than the next speech

Washington has not replaced the CLARITY Act with another comprehensive framework. It has chosen to work around its absence.

The success of that strategy will be measured by whether firms can use the resulting exemptions and rules without having their legal foundation repeatedly reopened in court. Until those documents arrive, the direction is clearer than the final regulatory structure.

This article is provided for informational purposes only and does not constitute legal, financial or investment advice.

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