CFTC goes around Congress, filing new crypto rulemaking measures with White House: reports

Dig Deeper

Related stories

2026/08/20: SEC eases crypto regulations as White House doubles down on support for digital assets 2026/08/17: Trump reportedly set to meet with crypto and prediction market leaders at White House 2026/08/07: US Senate postpones Clarity Act vote until September 2026/08/25: Total Philippines gambling ad ban seen handing market back to illegal operators, data from five countries show

The Backstory

Regulators move as Congress stalls

The CFTC’s reported decision to send new crypto rulemaking measures to the White House marks an escalation in Washington’s struggle to define who should police digital assets, prediction markets and related financial products. The move follows a failed Senate vote on the CLARITY Act, which had been designed to settle jurisdictional questions between the Commodity Futures Trading Commission and the Securities and Exchange Commission but became entangled in disputes over ethics, state authority and gambling law.

The timing is central. The CFTC filing was reported to have reached the Office of Information and Regulatory Affairs shortly after the Senate blocked the bill from advancing. That sequence suggests the agency is preparing to use its existing powers to create a market structure for crypto assets rather than wait for lawmakers to produce a broader statutory framework. CFTC Chair Michael Selig had already signaled that direction in an Aug. 20 post on X, saying he had directed staff to explore rules to codify a CFTC market structure for crypto assets.

For the crypto industry, the shift could offer a faster route to federal rules after years of fragmented enforcement. For states, tribal governments and gambling regulators, it raises a different concern: that federal commodities oversight could expand into areas traditionally governed by state gaming compacts and tribal sovereignty. The result is a regulatory contest in which crypto policy, sports-event contracts and political ethics have converged.

A White House push for digital assets

The administration’s position has been building for months. The SEC recently proposed its own “Regulation Crypto Assets,” a package framed as a clearer route for crypto companies to raise capital under federal securities laws. As previously reported, the SEC eased crypto regulations as the White House doubled down on support for digital assets, including exemptions that would allow certain offerings of up to $5 million over four years and up to $75 million over 12 months.

That proposal was not just a technical securities-law change. It came alongside a broader administration effort to make the U.S. a more favorable venue for crypto, artificial intelligence and prediction market companies. President Donald Trump has urged Congress to pass what he called a fair version of the CLARITY Act, arguing that clearer rules are needed to keep crypto businesses operating in the country and to establish U.S. leadership in emerging technologies.

The White House also became a meeting place for the industries most affected. Trump was expected to meet with leaders from cryptocurrency companies, prediction market platforms and financial institutions before the CFTC’s first formal Innovation Advisory Committee meeting, according to an earlier report on the planned White House meeting with crypto and prediction market leaders. The expected attendees included representatives of Coinbase, Ripple, Gemini, Robinhood, Polymarket, Kalshi, CME Group, Nasdaq and Intercontinental Exchange, underscoring how closely the administration’s agenda is tied to market operators seeking regulatory certainty.

The CLARITY Act becomes a political fault line

The CLARITY Act was intended to answer a long-running question: when should a digital asset be treated as a security and when should it fall under commodities regulation? The House-backed legislation sought to define the roles of the SEC and CFTC, creating a framework that could reduce enforcement uncertainty for exchanges, token issuers and intermediaries. But the Senate process exposed deeper disagreements that went beyond agency boundaries.

Before the failed vote, the Senate had already delayed action. Lawmakers postponed a procedural vote on the CLARITY Act until September, leaving negotiators to address disputes over stablecoin rewards, ethics restrictions for public officials involved in crypto and whether regulators and law enforcement would retain sufficient authority to pursue illicit finance. The delay also gave industry groups and state officials more time to press for changes.

Those tensions hardened as the bill approached a critical vote. A bipartisan coalition of 17 attorneys general and the Indian Gaming Association urged senators to reject the revised legislation, arguing that it would weaken state authority to act against online scams and fail to protect tribal gaming rights. As reported in coverage of the attorneys general and Indian Gaming Association opposition to the revised CLARITY Act, critics warned that the bill could displace state police powers over securities and commodities enforcement while leaving unresolved conflicts over gaming regulation.

The ethics debate added further pressure. Trump’s personal and family crypto interests have drawn scrutiny from Democrats and public-interest critics, with concerns that a more permissive federal framework could benefit businesses linked to the president. Those questions complicated Republican efforts to present the bill as a straightforward competitiveness measure and made it harder to secure the 60 votes needed to advance in the Senate.

Prediction markets sharpen the stakes for gaming

Although the CLARITY Act is formally a digital assets bill, its implications for prediction markets have drawn some of the fiercest opposition. Platforms such as Kalshi and Polymarket argue that event contracts should be regulated as financial products under the CFTC. State gaming regulators, tribal governments and casino industry groups counter that sports-related contracts can resemble wagers and should not bypass existing gambling laws.

That concern has been rising as prediction markets have moved into areas traditionally occupied by sportsbooks. Tribal representatives and lawmakers have sought language confirming that sports and casino gambling remain under state and tribal jurisdiction. Earlier reporting on tribal gaming groups seeking changes to the CLARITY Act over prediction markets showed how the dispute centered on whether the Commodity Exchange Act could override the Indian Gaming Regulatory Act or tribal-state gaming compacts.

The distinction matters financially and legally. Sports betting in the U.S. is governed by state-by-state licensing systems, tax regimes and consumer protections, with tribal gaming rights protected under federal law and negotiated compacts. If sports-event contracts are treated as commodities, platforms could potentially offer products nationwide under federal oversight, reducing the role of state regulators and tribes. That possibility explains why gaming stakeholders view crypto market-structure legislation as a direct threat even if the bill’s main purpose is digital asset regulation.

Agency action could reset the balance

The CFTC’s reported filing with OIRA could change the leverage in that debate. If the agency proceeds with rulemaking under existing law, it may create a regulatory path for crypto markets without waiting for Congress to settle the CLARITY Act’s most contentious issues. OIRA review is an early step, and the content of the filing has not been made public, but its existence indicates that the commission is preparing to move independently.

That approach carries advantages and risks. Rulemaking can be faster than legislation and may give market participants clearer compliance standards. It also can be challenged in court or reversed by later administrations more easily than a statute. For industries seeking durable rules, congressional action remains more stable. For regulators seeking to fill a vacuum, agency action may be the only practical option while lawmakers remain divided.

The SEC’s parallel proposal adds another layer. If both the SEC and CFTC advance crypto rules, the market could gain more immediate guidance but still face disputes over overlapping authority. The CLARITY Act was meant to resolve those boundaries. Without it, agencies may define them through rulemaking, enforcement choices and court challenges.

The broader stake is control over fast-growing markets that blur the line between finance, technology and wagering. Crypto companies want permission to build. Prediction market platforms want federal recognition. States and tribes want to preserve enforcement powers and gaming sovereignty. The CFTC’s turn to the White House shows that, after the Senate impasse, the next phase of U.S. crypto policy may be shaped less by legislation than by administrative action.