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Guide: SEC vs CFTC: how US crypto Guide: Perpetual futures, funding rates and liquidations,Newsletter

May 9, 2026

Crypto oversight split heads to Senate panel vote

Crypto Coin Show News Team Institutional, Legal & Crime, Regulation & Policy CFTC, Federal Crypto Framework, SEC, Senate Banking Committee, Stablecoin Amendment, Tim Scott

Regulation & PolicyMay 9, 2026·5 min read

The Senate Banking Committee is preparing a critical vote on federal crypto legislation that would split market oversight between the SEC and CFTC, a framework that could reshape how institutional investors access regulated digital asset trading. The bill faces its second attempt after collapsing in January over conflicting demands from banks, crypto firms, and both parties on stablecoin rewards and anti-money laundering standards.

Senate Banking Committee chairman Tim Scott requires all 13 Republican votes to advance the bill to full Senate consideration
A stablecoin amendment by Senators Thom Tillis and Angela Alsobrooks permits crypto rewards without banks’ yield restrictions, enabling Coinbase support
The bill must pass the Senate before year-end 2026 and needs seven Democratic votes beyond Republican support to reach President Trump

13 Republican committee members whose unanimous backing Scott deems necessary for passage
7 Democratic Senate votes required beyond Republican majority for full chamber passage
2026 year-end deadline to send legislation to President Trump’s desk for signature

The Senate Banking Committee stands on the threshold of a second attempt to establish the first comprehensive federal framework for digital asset regulation in the United States.

The imminent vote will determine whether lawmakers can finally advance legislation that assigns primary oversight responsibility to either the Securities and Exchange Commission or the Commodity Futures Trading Commission depending on asset classification, a structural choice that has enormous consequences for how institutional capital flows into crypto markets.

The bill represents the culmination of months of negotiation between fundamentally opposed constituencies, traditional banks fearing deposit flight to crypto products, digital asset companies seeking clear licensing standards, and Democrats divided between anti-money laundering enforcement and political safeguards around elected officials’ crypto holdings.

The committee’s first attempt in early January failed after weeks of back-and-forth between financial institutions and crypto businesses over language addressing stablecoin incentive structures. That previous version never reached a formal vote. Now, with renewed momentum and a modified stablecoin rewards provision, the committee is positioning itself for action.

Chairman Tim Scott has made clear the political threshold required: he stated last week that he wants “13 of 13 Republicans on board,” meaning every single Republican member of the 13-person GOP contingent must support the measure to demonstrate party unity and maximize leverage with Democrats in the full Senate.

Tillis-Alsobrooks Stablecoin Amendment Wins Crypto Industry but Fails to Placate Banks

The revised language addressing stablecoin rewards, authored by Republican Senator Thom Tillis of North Carolina and Democratic Senator Angela Alsobrooks of Maryland, permits crypto platforms to offer incentives to stablecoin holders without those rewards replicating the yields traditionally offered by banks on deposits.

The amendment was deliberately designed to unlock support from major institutional players in crypto: Coinbase Global Inc. has publicly backed the bill since the language was added, signaling that the crypto sector’s primary institutional voice sees a path forward in the legislation.

Yet banks remain unconvinced. Industry groups representing both large institutions and community lenders have stated that the amendment “fails” to adequately protect traditional bank deposits from being displaced by crypto stablecoin products.

The core banking objection hinges on a technical but critical distinction: stablecoins are digital assets pegged to the U.S. dollar designed to maintain stable value, and if they offer compelling incentive structures, depositors may move funds from savings accounts into crypto holdings.

Banks argue the Tillis-Alsobrooks language does not sufficiently prevent stablecoins from offering economic rewards that would compete directly with bank-deposited capital.

Banks can oppose this language, but we respectfully agree to disagree.

Senator Thom Tillis, North Carolina Republican

Tillis responded to banking concerns via social media, effectively signaling that further movement on the stablecoin language may be limited even though both parties acknowledge the issue remains unresolved.

Democrats Block Path Forward on Anti-Money Laundering and Conflict-of-Interest Rules

While the stablecoin dispute splits Republicans from banks, Democratic opposition reflects two distinct fault lines within the party. One cohort of Democrats wants significantly stricter anti-money laundering and know-your-customer requirements built into the bill, arguing that existing crypto-market compliance infrastructure is insufficient to prevent illicit capital flows.

A second group of Democrats is focused on inserting language that would prevent elected officials from earning financial returns on digital asset projects, a safeguard they view as essential to preventing conflicts of interest in legislation that regulates the industry itself.

Neither Democratic position appears to have found its way into the current committee text, creating a negotiating dynamic in which the committee vote may proceed without resolution of these issues.

Senators and crypto lobbyists privately expect that changes to address some Democratic concerns can still be made between the committee vote and any floor action in the full Senate, though this window for negotiation is narrowing significantly. The committee vote is imminent, and the political calendar constrains the available time.

Year-End 2026 Deadline Creates Hard Stop for Passage Before Trump Takes Office

The institutional investor significance of this bill hinges partly on timing and partly on political will. The House passed its own version of the Clarity Act in July, creating a baseline framework that the Senate must now match or reconcile. Critically, the Senate must pass the bill before the end of 2026 for it to reach President Trump’s desk for signature during his term.

That deadline is firm and effectively non-negotiable given Trump’s stated receptiveness to crypto regulation and his documented engagement with the industry.

To reach the President, the bill must first clear the full Senate, not just the Banking Committee. That requires the Republican caucus to hold together, currently 53 members, plus at least 7 Democratic votes to reach the 60-vote threshold needed to overcome a filibuster. The committee vote is therefore only the first gate.

Scott’s insistence on 13 Republican votes in committee is a signal that leadership intends to enter full Senate negotiations from a position of apparent consensus, making it harder for the minority to argue the bill lacks bipartisan support.

Institutional investors tracking this bill are watching whether Democrats will ultimately provide those seven votes or whether they will use filibuster leverage to extract concessions on AML rules and conflict-of-interest language before allowing a vote.

The committee vote itself will be the clearest indicator of whether Republicans can achieve Scott’s target of unanimity and whether Tillis-Alsobrooks has genuinely moved enough Democrats to signal their eventual support in the full Senate. If the committee vote proceeds and passes with a significant margin, it would suggest negotiations are on track for a full Senate vote sometime in 2025, giving Democrats months to negotiate further changes before the 2026 year-end deadline. Conversely, if Democrats block the committee vote or vote overwhelmingly against it, the timeline to pass legislation before Trump leaves office in January 2029 could become severely compressed, or the bill could fail entirely.

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CFTC issues new FAQs clarifying how crypto assets can be used as margin collateral in derivatives markets

Mar 20, 2026

Institutional

CFTC issues new FAQs clarifying how crypto assets can be used as margin collateral in derivatives markets

Crypto Coin Show News Team Institutional, Regulation & Policy CFTC, Crypto Collateral, Derivatives Markets, Digital Assets, Institutional Adoption, Margin Requirements, Regulatory Guidance

Editorial Summary

The Commodity Futures Trading Commission’s new guidance on crypto assets as margin collateral removes critical operational ambiguity for institutional derivatives traders and clearing participants. By clarifying permissible uses of digital assets, capital charges, and collateral treatment, the CFTC has provided the regulatory framework necessary for institutional adoption of crypto-backed trading positions in the futures and swaps markets.

The Commodity Futures Trading Commission (CFTC) has published comprehensive answers to frequently asked questions regarding how registered entities and market participants may utilize crypto assets and blockchain technologies within the regulatory framework governing derivatives markets. The guidance, released jointly by the Market Participants Division and the Division of Clearing and Risk, addresses critical operational questions surrounding capital charges, permissible residual interest, and reporting obligations for futures commission merchants (FCMs), derivatives clearing organizations, and swap dealers operating in the digital asset space. This clarification supplements previous CFTC staff letters on tokenized collateral and digital assets accepted as margin collateral, providing participants with authoritative interpretation of the operational framework established by the Commission for the industry. The eleven questions and answers published represent the most comprehensive regulatory guidance to date on how traditional derivatives infrastructure can accommodate cryptographic assets within established prudential frameworks.

Permitted Uses of Crypto Collateral in Futures Markets

The CFTC has clarified that futures commission merchants relying on Staff Letter 26-05 may apply the post-haircut value of a customer’s non-security crypto assets to secure that customer’s debit or deficit account balance. This represents a significant step forward in recognizing crypto collateral parity with traditional margin instruments. The post-haircut value—the asset value after a percentage deduction to account for price volatility and risk—can now be applied consistently across bitcoin, ether, and other qualifying digital assets. This clarification resolves substantive ambiguity that had persisted around whether crypto margins could be used equivalently to traditional collateral in secured lending arrangements, a question that has constrained institutional participation in digital asset derivatives markets.

The guidance establishes bright-line distinctions between what crypto assets may and may not do within the regulatory framework. Notably, the CFTC has ruled that FCMs may not invest customer funds in payment stablecoins, as the new guidance does not modify the list of permitted investments under Regulation 1.25. This boundary is critical: while crypto assets can serve as margin collateral, they cannot be deployed as investment vehicles for customer funds held by FCMs. Similarly, the Commission confirmed that swap dealers cannot exchange crypto assets, including payment stablecoins, as initial or variation margin for uncleared swaps, as the eligible collateral list under Regulation 23.156 remains unchanged. These limitations reflect the CFTC’s cautious approach to expanding crypto usage—permitting collateralization while restricting broader financial activities that might introduce concentration or counterparty risk.

Regarding residual interest—the interest earned on excess cash balances in segregated customer accounts—the CFTC has clarified that only proprietary payment stablecoins may be deposited as residual interest in customer segregated accounts for futures, foreign futures, and cleared swaps. Conversely, proprietary bitcoin, ether, or other crypto assets explicitly cannot serve this purpose. This distinction reflects regulatory concern about price volatility and the need to preserve the integrity of customer segregated account protections. FCMs depositing payment stablecoins as residual interest must impose a capital charge of at least 2% of market value, aligning with the approach adopted by the Securities and Exchange Commission (SEC) for broker-dealers holding payment stablecoins and establishing uniform prudential standards across regulatory jurisdictions.

Capital Treatment and Regulatory Harmonization with SEC Standards

The CFTC’s guidance on capital treatment of proprietary crypto positions establishes clear minimum standards while acknowledging the difference between mainstream digital assets and speculative holdings. The Commission confirmed that FCMs should apply the existing 20% minimum capital charge under Regulation 1.17 to bitcoin and ether inventory positions. This 20% charge represents a significant weight relative to traditional asset classes but substantially more favorable than the charges that might apply to highly speculative positions. The establishment of a defined minimum charge provides market clarity: institutions now know the minimum capital requirement for holding BTC or ETH as proprietary inventory, enabling better capital planning and risk management.

The 2% capital charge for payment stablecoins contrasts sharply with the 20% charge for volatile cryptocurrencies, reflecting the CFTC’s risk-based regulatory philosophy. Payment stablecoins, by design, maintain stable valuations and thus pose lower market risk to holding institutions. This differential treatment creates incentives for the use of stablecoins as margin instruments while imposing prudential costs that discourage excessive reliance on volatile cryptocurrencies for collateral purposes. The harmonization of the 2% charge with SEC standards for broker-dealers represents important regulatory coordination across jurisdictions, reducing the likelihood of regulatory arbitrage and establishing consistent risk treatment across the U.S. financial system.

Tokenized forms of otherwise eligible collateral remain permissible under the new guidance, provided they confer the same legal and economic rights as their conventional counterparts. This provision opens a pathway for institutional-grade blockchain infrastructure to be incorporated into derivatives markets without requiring wholesale replacement of existing collateral frameworks. A tokenized Treasury bond or equity pledge, if structured to provide equivalent legal rights and economic returns to the underlying asset, can serve collateral functions in CFTC-regulated markets. This approach balances regulatory conservatism with technological innovation, allowing blockchain infrastructure to enhance market efficiency without introducing novel legal or economic risks.

Institutional Implications and Market Structure Evolution

For institutional investors and derivatives traders, this guidance represents a material expansion of operational capabilities within the regulated futures and swaps ecosystem. Institutions can now construct multi-asset collateral portfolios that incorporate crypto holdings without awaiting further regulatory clarification, operating within defined capital charge frameworks and haircut parameters. This reduces legal uncertainty and enables institutional-grade risk management systems to incorporate digital assets into collateral optimization routines. Asset managers, hedge funds, and proprietary trading firms can now model crypto collateral more precisely, knowing the exact capital and valuation treatments applicable to different asset classes. The clarification of residual interest treatment for payment stablecoins may also encourage the development of enhanced cash management products using stablecoin infrastructure.

The guidance’s most significant implication lies in its potential to accelerate convergence between traditional derivatives infrastructure and digital asset markets. As futures commission merchants gain clarity on permissible practices, capital requirements, and compliance obligations, institutional participation in crypto derivatives should increase materially. Clearing organizations can now finalize policies on crypto collateral eligibility and risk management frameworks with confidence that their interpretations align with CFTC expectations. This standardization across clearing houses reduces fragmentation and enhances market liquidity by enabling more participants to access consistent collateral treatment across venues. The establishment of uniform 20% and 2% capital charges also provides benchmarking that could influence private market arrangements and over-the-counter derivatives pricing.

Looking forward, this guidance likely represents an interim step rather than a final regulatory position. As blockchain infrastructure matures and institutional usage patterns stabilize, the CFTC may issue additional guidance addressing emerging questions around custody standards for crypto collateral, valuation methodologies for less-liquid digital assets, and integration of decentralized finance (DeFi) protocols with regulated derivatives markets. The Commission’s willingness to provide interpretive guidance through FAQs rather than formal rulemaking suggests a measured regulatory approach that accommodates technological evolution while preserving prudential safeguards. For institutional investors, this represents a favorable regulatory environment characterized by clarity, proportionate risk-based capital treatment, and alignment with SEC standards—the regulatory foundations necessary for sustained institutional adoption of crypto-backed derivatives trading strategies.

XRP Wins Major Regulatory Clarity As Commodity Status Emerges

Mar 19, 2026

Institutional

XRP Wins Major Regulatory Clarity As Commodity Status Emerges

Crypto Coin Show News Team Institutional, Regulation & Policy, XRP CFTC, Commodity Classification, Digital Assets, Regulatory Clarity, Ripple, SEC, XRP

Editorial Summary

The regulatory classification of XRP as a digital commodity rather than a security represents a watershed moment for institutional adoption of digital assets. This distinction—confirmed through joint SEC and CFTC guidance—removes years of legal uncertainty and signals coordinated federal policy toward the broader crypto market. For institutional investors, this clarity opens pathways for regulated trading, custody, and integration into traditional financial infrastructure.

XRP is entering a pivotal moment in its evolution as growing regulatory clarity is fundamentally reshaping its position within the global financial system. The recent developments suggest that XRP is increasingly being viewed through the lens of a commodity rather than a security—a distinction with profound implications for how the asset is traded, adopted, and integrated into institutional finance. This regulatory clarity arrives after years of legal uncertainty, particularly following enforcement actions that created ambiguity about XRP’s classification under U.S. federal law. The emerging consensus among regulators represents not merely a technical determination, but a signal that major cryptocurrencies may operate within a clearer, more predictable legal framework going forward. For institutional investors, market participants, and blockchain developers, this shift marks a potential inflection point in crypto’s journey toward mainstream financial integration.

The Regulatory Distinction: Commodity Classification Reshapes XRP’s Legal Status

XRP has been formally designated a digital commodity by the SEC and CFTC, marking a watershed regulatory victory for the cryptocurrency sector. According to recent disclosures, the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission have released joint interpretive guidance that clarifies how federal securities laws apply to digital assets. Within this framework, XRP is cited as an exemplary digital commodity—defined as an asset whose value derives principally from the programmatic utility of a functional, decentralized system combined with market-driven supply and demand dynamics, rather than from expectations of profit through the efforts of others. This distinction is critical because it determines whether an asset must satisfy the Howey Test, the longstanding legal standard that classifies investments as securities under federal law. By positioning XRP outside the securities classification, regulators are effectively narrowing the scope of SEC oversight while expanding CFTC jurisdiction over spot and secondary market trading.

This regulatory clarity resolves the long-standing uncertainty that has shadowed XRP since its inception. The joint guidance represents a formal Commission-level interpretation rather than merely informal staff guidance, which significantly strengthens its legal weight and durability. The implication is profound: developers, exchanges, and custodians can now operate with greater confidence that their involvement with XRP trading and infrastructure does not trigger securities law compliance requirements. This shift also reflects a broader regulatory consensus that many major non-stablecoin cryptocurrencies may not qualify as securities when they possess sufficient decentralization and utility characteristics. The SEC and CFTC coordination itself signals a maturing regulatory approach, one designed to reduce jurisdictional overlap and create coherent policy across federal agencies. For institutional market participants accustomed to operating within clearly defined regulatory perimeters, this clarity eliminates a significant risk vector that had previously deterred participation.

The commodity classification carries immediate practical consequences for market infrastructure. Oversight of XRP in spot and secondary markets will shift primarily toward the CFTC, an agency with established expertise in commodity derivatives, position limits, and market manipulation oversight. This transition aligns with existing regulatory frameworks for physical commodities and commodity futures, creating familiar compliance pathways for institutional investors. The CFTC’s regulatory approach, while rigorous, tends to be more accommodating of derivative products and leveraged trading than the SEC’s securities-focused regime. Consequently, institutional investors may expect broader availability of XRP-denominated futures contracts, options, and structured products. Additionally, the commodity classification may facilitate easier integration of XRP into regulated custodial services, as the asset no longer faces the heightened compliance burdens associated with securities holding.

Fundamental Network Growth Accelerates Amid Regulatory Momentum

The regulatory clarity arrives at a moment when XRP’s network fundamentals are demonstrating accelerating growth trajectories. According to on-chain data, XRP has surpassed 7.7 million non-empty wallets for the first time in its thirteen-year history, indicating sustained network expansion and user adoption. Active addresses reached a five-week high of 46,767 on March 16, signaling renewed engagement and transaction activity across the network. These metrics matter for institutional investors because network growth directly correlates with utility adoption, developer participation, and ecosystem resilience. The expansion of the wallet base and active address count suggests that regulatory clarity is coinciding with organic growth in XRP’s practical use cases rather than speculation-driven volatility. This confluence of regulatory support and network expansion strengthens the fundamental case for institutional adoption.

Tokenized commodity activity on the XRP ledger has surged dramatically, growing from $111 million to $1.14 billion over the course of 2025 and into 2026. This represents explosive growth in a critical use case: the issuance and trading of commodities in tokenized form on a decentralized ledger. XRP’s share of the global tokenized commodities market has reached over 15 percent, establishing the network as a material venue for commodity tokenization. This metric is particularly significant for institutional participants because it demonstrates XRP’s utility in regulated, asset-backed applications—precisely the type of use case that appeals to traditional financial institutions seeking blockchain infrastructure. Commodity tokenization aligns with institutional risk management practices and regulatory frameworks, as tokenized commodities are backed by tangible underlying assets. The rapid growth in this sector indicates that XRP’s regulatory clarity is not merely theoretical; it is translating into concrete business activity and real-world adoption.

Network utilization metrics further underscore the acceleration in fundamental activity. XRP daily transactions have increased to nearly 3 million over the past week, reflecting sustained demand for on-ledger activity. Automated market maker pools have expanded to approximately 27,000, indicating robust liquidity infrastructure and decentralized exchange activity. These operational metrics demonstrate that XRP’s network is handling material transaction volumes and supporting sophisticated financial applications. For institutional investors evaluating whether XRP possesses sufficient liquidity and infrastructure maturity for large-scale adoption, these metrics provide tangible evidence of network capacity. The AMM ecosystem expansion is particularly noteworthy because it indicates developer and merchant participation in building financial products on XRP, a prerequisite for enterprise adoption. These fundamentals persist independent of macroeconomic conditions, suggesting that XRP’s growth trajectory reflects genuine adoption rather than cyclical interest rate dynamics.

Institutional Integration and Market Outlook: The Path Forward

The convergence of regulatory clarity and network growth creates a favorable environment for institutional adoption of XRP. Institutional investors have historically demanded clear regulatory status before committing capital to digital assets, viewing legal uncertainty as an unpriced risk. The SEC and CFTC joint guidance removes this barrier by establishing XRP’s commodity classification through formal regulatory interpretation. Consequently, institutional asset managers can now incorporate XRP into portfolios with greater confidence in regulatory treatment. Additionally, regulated custodians, including those under the supervision of the Office of the Comptroller of the Currency and banking regulators, may find it easier to offer XRP custody and trading services. The regulatory clarity may also accelerate the adoption of XRP in institutional payment and settlement applications, as the commodity classification suggests regulatory acceptance of XRP’s use in commerce and financial transactions.

The broader market implications extend beyond XRP itself to the entire digital asset ecosystem. The SEC and CFTC guidance establishes a precedent for how regulators evaluate digital assets and may signal a shift toward commodity classification for other major cryptocurrencies. This development potentially creates a bifurcated regulatory landscape where assets meeting specific decentralization and utility criteria receive commodity classification, while other assets may remain subject to securities law. This framework offers clarity not only for existing market participants but also for future digital asset launches and innovation. Developers considering new blockchain projects can now reference the regulatory standards articulated in the joint guidance, reducing uncertainty and encouraging capital formation in the digital asset sector. For institutional investors, this regulatory evolution suggests that digital assets are transitioning from speculative instruments toward recognized asset classes with established legal frameworks.

Looking forward, XRP’s regulatory clarity and network fundamentals position the asset for potential expansion in institutional use cases. The tokenized commodities boom demonstrates immediate commercial applications with institutional relevance, particularly in commodity trading and settlement. Payment and remittance applications may accelerate as institutional payment networks recognize XRP’s utility for cross-border transactions. Additionally, central banks and financial institutions exploring digital asset infrastructure may increasingly evaluate XRP as a potential settlement mechanism. For institutional investors, the combination of regulatory certainty, network growth, and expanding use cases suggests XRP has transitioned from a speculative asset into a recognized commodity with maturing institutional infrastructure. While macroeconomic factors will continue to influence digital asset valuations, XRP’s regulatory status and network metrics indicate that the asset is developing structural characteristics necessary for long-term institutional adoption and

Mar 19, 2026

Regulation & Policy

SEC & CFTC Draw the Line:A New Era for Crypto Clarity

Crypto Coin Show News Team Editor's Choice, Institutional, Regulation & Policy CFTC, Crypto Regulation, Digital Commodities, Mining, SEC, Stablecoins, Staking

SEC & CFTC Draw the Line: A New Era for Crypto Regulation | Crypto Coin Show

BTC — DIGITAL COMMODITY ETH — DIGITAL COMMODITY SOL — DIGITAL COMMODITY USDC — GENIUS ACT STABLECOIN NFTs — DIGITAL COLLECTIBLES SEC × CFTC — JOINT INTERPRETATION ISSUED MARCH 17, 2026 MINING — NOT A SECURITY STAKING — NOT A SECURITY AIRDROPS — NOT A SECURITY BTC — DIGITAL COMMODITY ETH — DIGITAL COMMODITY SOL — DIGITAL COMMODITY USDC — GENIUS ACT STABLECOIN NFTs — DIGITAL COLLECTIBLES SEC × CFTC — JOINT INTERPRETATION ISSUED MARCH 17, 2026 MINING — NOT A SECURITY STAKING — NOT A SECURITY AIRDROPS — NOT A SECURITY

Regulation & Policy

SEC & CFTC Draw the Line:
A New Era for Crypto Clarity

After more than a decade of regulatory ambiguity, the SEC and CFTC issued a landmark joint interpretation on March 17, 2026 — establishing a coherent taxonomy for crypto assets and declaring that most are not securities. Here’s what it means for the industry.

Ashton Addison Founder & CEO, Crypto Coin Show

March 19, 2026 · 8 min read

SEC / CFTC / Regulation

// FIGURE 01 — SEC & CFTC jurisdictional split under the new joint interpretation

A Decade of Waiting — Over

For years, the American crypto industry has operated under a fog of regulatory uncertainty. Founders, builders, and investors alike were forced to navigate a landscape where the rules of the road were written after the fact — through enforcement actions rather than clear guidance. The SEC under previous leadership became notorious for what critics called “regulation by enforcement,” leaving innovators vulnerable to retroactive legal exposure with no reliable safe harbors to build around.

That era appears to be ending. On March 17, 2026, the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission issued a landmark joint interpretation clarifying how federal securities laws apply to crypto assets. The document represents the most comprehensive, authoritative delineation of crypto regulation in U.S. history — and its central message is significant: most crypto assets are not securities.

After more than a decade of uncertainty, this interpretation will provide market participants with a clear understanding of how the Commission treats crypto assets under federal securities laws. This is what regulatory agencies are supposed to do: draw clear lines in clear terms.

— SEC Chairman Paul S. Atkins, March 17, 2026

The New Token Taxonomy

At the heart of the interpretation is a coherent five-category taxonomy for digital assets — the first time U.S. regulators have systematically classified the full spectrum of crypto assets in official guidance. Each category is analyzed under the legal definition of “security” to determine which agency has jurisdiction and what compliance obligations apply.

Token Taxonomy Under the SEC/CFTC Joint Interpretation

Investment Contracts: How Tokens Enter — and Exit — Regulation

One of the most nuanced and practically important aspects of the interpretation addresses the lifecycle of a token’s regulatory status. For the first time, the SEC has articulated a clear framework for how a non-security crypto asset can become subject to securities regulation — and how that regulatory obligation can end.

A token becomes subject to an investment contract when an issuer offers it with representations or promises to undertake essential managerial efforts from which buyers reasonably expect profits. This is an updated application of the longstanding Howey test, but with far more granularity than courts or regulators have previously provided.

Crucially, the interpretation also acknowledges what many legal scholars have argued for years: an investment contract can terminate. Once an issuer has fulfilled its promises — or has definitively failed to — the securities obligation ends. This means a project token that launched under a securities framework can mature into a pure commodity once the network is truly decentralized and the founding team’s essential role has concluded.

For far too long, American builders, innovators, and entrepreneurs have awaited clear guidance on the status of crypto assets under the federal securities and commodity laws. With today’s interpretation, the wait is over.

— CFTC Chairman Michael S. Selig, March 17, 2026

Mining, Staking, Wrapping & Airdrops Clarified

The interpretation goes further than taxonomy — it addresses four specific crypto activities that have long existed in a legal grey zone, providing clear answers that will benefit millions of network participants:

// Key Activity Rulings

⛏

Protocol Mining — Mining activity on a decentralized protocol does not constitute the offer or sale of a security. Miners validating transactions are participants in a commodity network, not investors in a common enterprise.
🔒

Protocol Staking — Staking a non-security crypto asset on its native protocol does not create a securities transaction. This is a pivotal ruling for proof-of-stake networks like Ethereum, Solana, Cardano, and many others.
🔄

Wrapping — Wrapping a non-security crypto asset (e.g., creating wBTC or wETH for use on another chain) does not transform it into a security. Cross-chain interoperability mechanisms remain outside securities law.
🪂

Airdrops — Certain token distributions known as airdrops do not involve an “investment of money” under the Howey test and therefore are not securities transactions. Projects can now airdrop tokens with far greater legal confidence.

Which Coins & Categories Benefit Most

While the interpretation provides relief across virtually all corners of the crypto market, several asset classes and individual projects stand to benefit most immediately:

BTC

Bitcoin

Explicitly classified as a Digital Commodity. Bitcoin miners receive explicit protection — their activity is not a securities transaction. The legal foundation of the world’s largest crypto asset is now firmly codified.

✓ Digital Commodity

ETH

Ethereum

The staking clarification is enormous for ETH. Solo stakers, liquid staking protocols, and restaking platforms all receive legal clarity that their activity does not constitute a securities offering.

✓ Digital Commodity

SOL

Solana

Solana’s high-throughput proof-of-stake model is directly addressed. Both staking rewards and the SOL token itself gain commodity classification, removing a key legal overhang that had weighed on institutional adoption.

✓ Digital Commodity

USDC / USDT

Payment Stablecoins

GENIUS Act-compliant stablecoins are explicitly excluded from SEC jurisdiction. This opens the door for banks, fintechs, and payment networks to issue and use stablecoins at scale without fear of securities enforcement.

✓ Not a Security

NFTs

Digital Collectibles

Art NFTs, gaming items, music tokens, trading cards, and meme-based digital assets are classified as Digital Collectibles — not securities. Creators and platforms gain long-awaited certainty.

✓ Digital Collectible

L1 / L2 Tokens

Utility & Governance Tokens

Tokens that power decentralized infrastructure — gas tokens, governance tokens, access passes — may qualify as Digital Tools or Digital Commodities depending on their function and the maturity of the underlying protocol.

✓ Case-by-Case Clarity

Why This Is Broadly Positive for the Industry

The regulatory significance of this interpretation cannot be overstated. Its impact extends far beyond any individual coin or project — it restructures the entire legal foundation on which the U.S. crypto industry operates.

First, it ends a decade of “regulation by enforcement.” The SEC’s prior approach of pursuing legal action as a substitute for rulemaking created enormous chilling effects on investment and innovation in the United States. Founders raised funding abroad. Protocols incorporated offshore. Talent fled to more permissive jurisdictions. With clear rules now in place, that calculus changes.

Second, it creates a workable compliance path for issuers. Projects that launch with a degree of centralization — which virtually all do — now have a roadmap: comply with securities laws during the period where essential managerial promises are being fulfilled, then transition to commodity status upon successful decentralization. This mirrors how equity investments in traditional startups work, and it’s a framework the industry can build around.

Third, the CFTC’s participation is a major unlock. By joining the interpretation and confirming that non-security crypto assets can be classified as commodities under the Commodity Exchange Act, the CFTC signals it is ready to step into an expanded supervisory role. The CFTC has historically been seen as a more innovation-friendly regulator than the SEC, and its willingness to provide affirmative guidance is widely welcomed by the industry.

Fourth, it clears the path for institutional capital. Many institutional investors — pension funds, sovereign wealth funds, endowments — have been unable to engage with the crypto market due to unresolved legal status questions. With primary assets like BTC, ETH, and SOL now holding explicit commodity classification, the compliance and due diligence requirements for institutional entry become significantly more manageable.

Finally, it works in concert with Congressional efforts. Both SEC Chairman Atkins and CFTC Chairman Selig explicitly framed this interpretation as a bridge to forthcoming market structure legislation. The bipartisan momentum behind comprehensive crypto legislation — which has stalled repeatedly in recent years — now has a regulatory scaffold to build upon, rather than having to design rules in a vacuum.

The CCS Take

At Crypto Coin Show, we have covered more than 1,500 interviews with founders, developers, investors, and policymakers across the blockchain industry since 2014. Few developments in that span rival the importance of what the SEC and CFTC published on March 17, 2026.

This is not merely a policy document. It is a structural shift in how the United States relates to digital asset innovation. The industry is watching what comes next — both in terms of Congressional legislation and how enforcement agencies operationalize this guidance in practice. But the direction is clear, the intent is explicit, and for the first time in a very long time, builders in America have a foundation to stand on.

Stay tuned to CCS for interviews with founders and legal experts responding to this landmark ruling. Subscribe to the CCS Insider newsletter for our in-depth weekly breakdown.

CFTC chair nominee says more funding needed for crypto oversight

Jun 11, 2025

AI News

CFTC chair nominee says more funding needed for crypto oversight

Crypto Coin Show News Team AI News, Blockchain, DeFi, Institutional, Regulation & Policy Andreessen Horowitz, Brian Quintenz, CFTC, Cryptocurrency Regulation, Digital Asset Oversight, Senate Hearing

During a Senate nomination hearing on Tuesday, Brian Quintenz, President Donald Trump’s nominee to lead the Commodity Futures Trading Commission (CFTC), stated unequivocally that the agency would need more funding.

This would be necessary if Congress grants the CFTC expanded authority to regulate the cryptocurrency industry.

“It is precedental that new jurisdiction comes with new resources,” Quintenz said in response to multiple senators’ questions. “So to the extent that new authorities come to the agency… I would anticipate that new resources would likely be needed.”

Quintenz, currently head of global policy at Andreessen Horowitz’s crypto division (a16z crypto), previously served as a CFTC commissioner from 2017 to 2021. If confirmed by the Senate, he would return to the CFTC at a moment of heightened interest in digital asset regulation and amid significant personnel turnover at the agency.

Senate backs expanded resources for CFTC

Lawmakers from both parties generally agreed with Quintenz’s assessment. While a few expressed reservations about President Trump’s approach to regulatory agencies, there was broad consensus that the CFTC would require a larger budget and staff to oversee an expanded crypto mandate effectively.

“It is also essential that the CFTC have the institutional capacity, both in staffing and resources, to fulfill its mandate in the face of these emerging challenges,” said Sen. Amy Klobuchar (D-Minn.) before asking for Quintenz’s take on resourcing.

Quintenz responded that undertaking much of that responsibility would be a challenge. He added that the precedent has been to provide new resources alongside new authorities.

The hearing took place as lawmakers continue to craft legislation that could hand the CFTC a central role in regulating crypto spot markets, currently in regulatory limbo between the Securities and Exchange Commission (SEC) and other federal agencies.

Quintenz set to lead alone as CFTC faces leadership exodus

If confirmed, Quintenz may initially be the only commissioner at the CFTC. In recent weeks, all four remaining commissioners have either stepped down or announced their departures.

Republican Commissioner Summer Mersinger resigned to become CEO of the Blockchain Association, while Acting Chair Caroline Pham has indicated she will exit once Quintenz is confirmed. Democrats Kristin Johnson and Christy Goldsmith Romero departed or scheduled their exits.

This leadership vacuum raises questions about the agency’s near-term capacity to function effectively, let alone take on new responsibilities in the fast-evolving crypto space.

Quintenz, known for his pro-innovation stance during his previous CFTC tenure, has been a vocal advocate for clear regulation in the digital asset space. He has called for clearly defining the responsibilities of federal agencies in the crypto space and offering clear guidance to industry participants.

His return to the CFTC, especially as the commission’s lone commissioner, could influence how the agency thinks about crypto rulemaking if Congress moves ahead with proposals to broaden the agency’s mandate.

Trump’s larger fiscal plan, which includes deep cuts to government spending and essentially an omnibus bill of infrastructure and defense spending, has only complicated negotiations around the budget. While it is unclear if the CFTC will secure the resources it requires, the agency is prepared to step in potentially transformative ways in crypto regulation.

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Senate sets hearing date for crypto ally CFTC chair nominee

Jun 5, 2025

AI News

Senate sets hearing date for crypto ally CFTC chair nominee

Crypto Coin Show News Team AI News, Blockchain, DeFi, Legal & Crime, Regulation & Policy, Stablecoins Andreessen Horowitz, Brian Quintenz, CFTC, Crypto Regulation, Digital Assets, Senate Agriculture Committee

Brian Quintenz, President Donald Trump’s nominee to lead the US Commodity Futures Trading Commission (CFTC), is set to face the Senate Agriculture Committee on June 10.

The committee oversees commodities and futures regulation and will hold a hearing to evaluate Quintenz’s nomination as chair of the powerful financial regulatory agency.

Quintenz is a former CFTC commissioner, having served on the committee from 2017 to 2021. His nomination comes during a period of great change for the commission. Two commissioners, Summer Mersinger and Christy Goldsmith Romero, resigned their positions in late May. That has left the five-member panel with only two confirmed commissioners as of June 1.

Rostin Behnam, the previous chairman, left in February. The CFTC is overseen by acting Chairwoman Caroline Pham and Commissioner Kristin Johnson. But both have publicly declared their plans to depart, Pham for a private-sector position and Johnson to step down later this year. That’s because Quintenz’s confirmation could lead to a wholesale change in leadership at the CFTC.

Crypto ally moves to lead CFTC

Quintenz is a known proponent of cryptocurrencies. In 2021, he joined Andreessen Horowitz’s crypto-focussed venture arm, a16z Crypto, as head of policy. In that role, he advocated for lighter regulation of the digital asset industry and regularly took the position that it was the CFTC’s job, not the SEC’s, to take the lead on regulating cryptocurrencies.

He is one of the types in the crypto world who think our current regime, especially from the SEC, is too harsh. The industry is receptive to a Quintenz-led CFTC, seeing him as someone who gets both innovation and markets.

If he is confirmed, Quintenz will probably weigh in on issues such as decentralized finance (DeFi), crypto derivatives, prediction markets, and clearing systems involving blockchains, all of the topics the CFTC is currently evaluating. His stewardship could influence how US policy evolves in response to the rapidly changing world of digital finance, such as potential legislation around stablecoins and digital commodities.

While he has the backing of the crypto world, Quintenz’s nomination isn’t without controversy. He filed financial disclosures before the hearing reflecting holdings valued at about $3.4 million in crypto and industry-related companies. Ethics watchdogs have sounded the alarm about how this stake could influence his neutrality if he were to be confirmed.

There’s a particular concern about his board seat with Kalshi, a prediction market platform that recently tussled with the CFTC over its pursuit to offer contracts linked to US elections. Quintenz has recused himself from some CFTC cases related to Kalshi but has not agreed to take himself out of Kalshi cases in the future. Critics say this could undermine trust in the commission’s independence and objectivity.

Trump seeks to reshape CFTC leadership

If confirmed by the Senate, Quintenz would be the only sitting commissioner named by Trump. However, with Pham and Johnson due to step down, the president was given the opening to nominate as many as four new commissioners. That would empower the president to have broad control over the CFTC’s leadership for the first time in his current tenure.

No more than three commissioners can be members of the same political party under CFTC rules. Because Quintenz is a Republican, Trump would have been allowed to nominate two more Republicans and two Democrats to complete the panel. Each nominee would still need to be confirmed by the Senate.

This remolding of the CFTC could dramatically change the regulatory philosophy of the agency. The commission has long been seen as more tech and innovation-friendly than the SEC and could lean even further in that direction under Trump’s picks. This shift could affect not just the crypto markets but also futures, options, and swaps — pillars of the United States’ financial infrastructure.

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Ripple CLO backs CLARITY Act to clear crypto chaos

May 31, 2025

Legal & Crime

Ripple CLO backs CLARITY Act to clear crypto chaos

Crypto Coin Show News Team Legal & Crime, Regulation & Policy, XRP Bipartisan, CFTC, CLARITY Act, Crypto Regulation, Digital Assets, Ripple, SEC, Stuart Alderoty

Ripple’s Chief Legal Officer, Stuart Alderoty, has publicly endorsed the newly introduced Digital Asset Market Clarity Act (CLARITY Act).

He calls it a significant step toward establishing a clear and consistent regulatory framework for cryptocurrencies in the United States.

Alderoty argued that “Clarity shouldn’t be controversial” and that the bill would allow for a practical and intelligent regulatory environment.

The Ripple’s Chief Legal Officer thanked some prominent lawmakers for their role in leading the charge. This list includes Representatives French Hill, Congressman Glenn Thompson, Angie Craig, the GOP Majority Whip Dusty Johnson, Don Davis, Bryan Steil, Ritchie, and Davidson.

Their work underscores the need for new regulatory guidelines that can be spun up and revised quickly as the digital assets space accelerates. Rep. Bryan Steil released the following statement regarding the CLARITY Act on X.

The post mentions that the bill is designed to bring clarity to digital assets during this golden period. Supporters of the bill are united by a desire to enable the digital assets sector to expand by establishing a trustworthy and predictable set of laws. Right now, businesses and investors are often uncertain about which of their activities may delay the future of the industry.

Bipartisan CLARITY Act redefines crypto oversight

Introduced on May 29, 2025, by members of Congress from both sides of the aisle, the CLARITY Act seeks to clarify the regulatory roles of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) regarding digital assets. The bill is looking to categorize most cryptocurrencies as virtual commodities overseen by the CFTC rather than as a security regime, as is the current practice of the SEC.

With the rising use of digital assets, now is a good moment for such a move. This is because their increasing adoption and market maturity offer opportunities for broader economic integration. The rising use of these assets is also a concept shared by MicroStrategy executive chairman Michael Saylor.

Alderoty noted the bill’s significance in bringing “long-overdue clarity” to the digital asset landscape. The bill, he said, takes the industry closer to a “smart, workable framework” that creates an equilibrium between innovation and consumer protection.

CLARITY Act safe harbor advances as Ripple calls for clear crypto rules

The CLARITY Act also introduces a four-year safe harbor provision for primary token offerings if the underlying network reaches a “mature blockchain system” status and the total raise stays below $75 million during any 12-month window.

Alderoty also supported the CLARITY Act, as Ripple remains committed to advocating for regulatory clarity regarding the cryptocurrency industry.

He has sent a letter to the SEC requesting the commission to clarify when a digital asset ceases to be an investment contract. Not all of them, he contended, should be subject to the same securities regulations — especially not on secondary market transactions — and he offered a safe harbor to shield compliant crypto issuers from enforcement risk.

As XRP regains attention as a top crypto buy with the Ripple SEC lawsuit nearing resolution, uncertainty lingers following SEC Commissioner Hester Peirce’s recent “New Paradigm” speech.

Ripple’s letter directly responds to the pivotal question posed in the speech: “When does a digital asset separate from an investment contract?”

Ripple referenced established securities law analysis from legal experts like Lewis Cohen in its response. Cohen’s analysis contends that current US investment contract law does not consider routine transfers of most fungible crypto assets in secondary markets as securities.

With the CLARITY Act, the US may finally start taking concrete steps to provide regulatory clarity for the crypto industry.

While the bill gets consideration in the legislative committee, its passage would lay a benchmark for the future of how US regulators will oversee digital assets.

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