SEC Prepares to Rule Cryptos on Own if Congress Fails to Pass Clarity Act

The US Securities and Exchange Commission (SEC) is prepared to move forward on its own if Congress fails to pass the CLARITY Act, a bill aimed at regulating the crypto market. SEC Chair Paul Atkins stated that the agency can create rules for cryptocurrencies under its existing powers, even without Congressional approval.

The initiative, dubbed 'Regulation Crypto,' would mark a significant shift from the SEC's previous enforcement-driven approach to regulating the industry. Instead of relying on lawsuits, the agency would publish formal rules covering key areas such as token launches, decentralized projects, and crypto trading platforms.

Atkins emphasized the need for clear direction in the form of a statute to future-proof the regulatory framework. However, if the CLARITY Act stalls, the SEC is prepared to proceed with its own rulemaking process, which could include registration exemptions for token launches, safe harbor rules for decentralized projects, and standards for crypto custody.

The CLARITY Act has been stalled in the Senate due to several issues, including a lack of agreement among lawmakers. Senate Majority Leader John Thune has suggested that the bill may not pass before lawmakers leave for summer break, while Sen. Cynthia Lummis warned that if an agreement is not reached by August 7, 2026, the bill may effectively be delayed until 2027.