Bypassing Congress: CFTC Ready to Unilaterally Reshape U.S. Crypto Rules

The Commodity Futures Trading Commission is preparing to unilaterally establish rules for the cryptocurrency industry if Capitol Hill fails to break its legislative deadlock over digital asset oversight.

During the Innovation Advisory Committee‘s first meeting on Thursday, CFTC Chair Michael S. Selig emphasized that his priority remains the enactment of bipartisan market structure laws. However, he warned that if the legislation languishes, the CFTC is prepared to deploy its current statutory powers to create a regulatory framework for digital assets, while reaffirming that “the most important step towards future-proofing this industry is passing this bipartisan bill.”

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Under the proposed Clarity Act, a unified federal framework would be created to divide oversight responsibilities for crypto markets between the CFTC and the SEC. According to Selig, securing these definitions through formal legislation is crucial because it prevents subsequent administrations from easily dismantling the regulatory landscape.

This backup strategy highlights a long-standing jurisdictional dispute between the CFTC and the Securities and Exchange Commission (SEC) over which agency holds authority over the multi-trillion-dollar digital asset market. Historically, the CFTC has regulated commodities and derivatives, while the SEC has classified many tokens as unregistered securities—a dual-track approach that has left digital asset firms navigating conflicting regulatory demands in the absence of explicit federal legislation.

“Passing Clarity is the surest way that we can prevent another Gary Gensler from running a rogue campaign of lawfare against the individuals and companies in this room today,” Selig remarked, pointing to the former SEC chairman’s record of initiating expensive legal actions against cryptocurrency startups.

President Donald Trump on Wednesday pressed lawmakers to approve a “fair version” of the Clarity Act, though Selig made clear that the CFTC will proceed independently should congressional efforts falter.

“If Clarity continues to stall because of Democrat obstruction, the CFTC will utilize its existing authorities to begin establishing a regime for crypto asset markets,” the chairman stated.

Preliminary directives have already been issued to agency personnel to outline the contours of such regulatory rules.

“To achieve this, I’ve directed the CFTC staff to begin exploring rules to codify a CFTC market structure for crypto assets using the agency’s existing authorities,” Selig told attendees.

The regulatory blueprint described by Selig would allow both registered firms and currently unregulated cryptocurrency trading platforms to operate under CFTC supervision, enabling them to provide leveraged or margined digital asset transactions under a specialized regulatory regime.

Additionally, the chairman instructed staff members to collaborate with creators of decentralized, on-chain financial protocols to establish a viable path for their legal operations within the country.

“I’ve also directed staff to engage with developers of on-chain finance protocols to establish ways in which developers can offer their protocols in a legal and compliant manner in the United States, future-proofing developer protections once and for all,” Selig said, echoing earlier statements from the president.

At a Wednesday press briefing alongside industry executives, Trump noted that Selig is actively coordinating efforts to integrate Hyperliquid, a decentralized perpetual futures platform, into the domestic regulatory framework.

While the commission will temporarily hold back to allow lawmakers a final window to pass the Clarity Act, Selig pledged immediate regulatory intervention if that opportunity is missed, warning: “Rest assured, I will direct CFTC staff to move swiftly to propose these rules for the industry.”