The U.S. Securities and Exchange Commission (SEC) is preparing to establish its own regulatory framework for cryptocurrencies as the CLARITY Act faces procedural delays in the Senate. SEC Chair Paul Atkins has indicated that the agency can leverage its existing authority to address regulatory gaps if Congress fails to pass the bill.
Atkins previously noted that the SEC and the Commodity Futures Trading Commission (CFTC) could “fill in the gaps” without new legislation, adding that regulators can “make do with our authority” while lawmakers continue negotiations. This approach places agency rulemaking behind the SEC’s broader Regulation Crypto Assets plan.
SEC Prepares Regulation Crypto Framework
In March, Atkins introduced Regulation Crypto Assets as a comprehensive framework for token offerings and digital asset oversight. The plan includes a token taxonomy, guidance on when an investment contract ends, and exemptions that could provide crypto projects with a clear route for raising capital.
The SEC’s 2026 agenda calls for clearer rules covering crypto fundraising, custody, and blockchain-based securities trading. Atkins emphasized the need for formal standards rather than relying primarily on enforcement actions. Any final rules would require a proposal, public comment period, and a Commission vote before taking effect.
CLARITY Act Faces Narrow Senate Window
Meanwhile, the CLARITY Act cleared the Senate Banking Committee by a 15-9 vote on May 14 and passed the House by 294-134 in July 2025. The legislation would divide digital asset oversight between the SEC and CFTC while establishing federal rules for trading platforms.
Several disputes continue to slow Senate negotiations. Democratic senators are pushing for stronger provisions on government ethics, consumer protection, illicit finance, conflicts of interest, and market integrity. Lawmakers are also debating protections for decentralized finance (DeFi) developers and limits on rewards tied to stablecoins.
Senators Thom Tillis and Ruben Gallego have taken leading roles in negotiations over the bill’s ethics provisions. Details of any final compromise have not been publicly released. The bill still needs enough support to clear the Senate’s 60-vote procedural threshold before a final vote.
August Recess Raises Pressure on Lawmakers
The Senate’s planned state work period begins August 10 and continues through September 11, giving lawmakers a limited window to start the voting process before the break. Senate leaders are also handling nominations and other legislation competing for floor time.
Atkins has stated that only Congress can fully “future-proof” crypto rules through market structure legislation. A statute could define agency powers more clearly and reduce the risk of later policy reversals. SEC rules alone cannot settle every issue involving the CFTC’s authority over digital commodities.
Even so, the SEC can move first in areas covered by federal securities law, including token fundraising exemptions, custody standards, and rules for securities trading on digital platforms. Proposed rules could advance even if the CLARITY Act moves into a later Senate window.
The SEC’s plan would not create a complete market structure law but would address areas already tied to federal securities rules. Coordination with the CFTC would remain necessary for digital commodities and platforms offering multiple token types. Congress would still control any wider division of federal authority.
This fallback plan marks a shift from an approach centered mainly on lawsuits and case-by-case decisions, placing more crypto policy decisions with regulators while Congress continues negotiations. The Senate schedule will determine whether legislation or agency action shapes the next stage of U.S. crypto regulation.
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