US digital asset rules at risk as election looms

The digital asset industry is rapidly evolving, but the United States lacks clear, lasting rules to govern it. The CLARITY Act, which aimed to create a national framework for digital assets, was passed by the House in 2025 but stalled in the Senate. Without congressional action, federal agencies like the SEC and CFTC have stepped in with new regulations, reshaping the market. However, these rules are politically fragile, as they were adopted without congressional approval and could be overturned after the next election.

The upcoming midterms could shift power in Congress, with Democrats having a 64% chance of controlling the Senate. Historical precedent shows that a change in congressional control can lead to intense oversight and challenges to executive actions. Democrats may seek to undo recent agency regulations, citing concerns over political influence and corruption in the Trump administration.

The lack of a clear regulatory framework creates uncertainty for businesses, investors, and consumers. Other countries, such as Europe with its MiCA regulation and Singapore with its Payment Services Act, are establishing stable rules for digital assets. The U.S. risks falling behind if it fails to resolve this political gridlock. The next Congress must prioritize bipartisan legislation to provide regulatory certainty for the digital asset industry.