CFTC Prepares Own Crypto Rules as CLARITY Act's Chances Fade

CFTC Chairman Michael S. Selig has announced that the agency will use its existing authorities to establish a crypto asset market regime if Congress does not pass the CLARITY Act.

The act, which aims to provide clarity on how digital assets are regulated in the US, has seen its chances of passing fade after the Senate left for recess without voting on it. A cloture vote is scheduled for September 15, but Selig said that if Congress fails to act, the CFTC will move forward with proposing new rules.

Selig emphasized that the CFTC wants to support the CLARITY Act and is hopeful that it will pass, but he also expressed confidence in the agency's ability to create a regulatory framework for crypto assets. He has directed CFTC staff to explore ways to codify a market structure for crypto assets using existing authorities.

The CFTC chairman encouraged the industry to continue engaging with lawmakers to support the CLARITY Act, and warned that if it does not pass, the agency will move swiftly to propose new rules. This would mean that developers of on-chain finance protocols would need to find ways to offer their protocols in a legal and compliant manner.