CFTC Prepares Alternative Crypto Rules as Clarity Act Fails to Advance

CFTC Chair Mike Selig warned that if Congress fails to pass the Digital Asset Market Clarity Act, his agency will implement alternative regulations for crypto asset markets. Speaking at the inaugural meeting of the Innovation Advisory Committee, Selig stated that the CFTC would utilize its existing authorities to establish a regime for crypto assets.

The move comes as the SEC proposed Regulation Crypto Assets this week, allowing startups to raise funds with fewer regulatory hurdles. The two agencies previously issued a joint policy stance defining different kinds of digital assets. However, Selig emphasized that passing the Clarity Act was the surest way to prevent 'another Gary Gensler from running a rogue campaign of lawfare' against the industry.

Ripple Labs CEO Brad Garlinghouse echoed this sentiment at the meeting, highlighting the difference in leadership and its impact on regulation. Selig has also directed staff to work with developers to build rules for protocols to operate legally and compliantly in the US.