Topic
US policy effort to classify crypto assets as securities or commodities and divide oversight between the SEC and CFTC, via bills such as the CLARITY Act.
The CFTC chair has told staff to draft leveraged trading and DeFi rules under existing authority. A framework built by an agency is one a future agency can unbuild.
Perspective Coverage
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CFTC Chair Mike Selig says his agency will write crypto rules under existing law, with two prerules already filed at the White House. Decrypt's newsletter argues the agency can reach leveraged products such as perpetual futures, while spot trading still needs Congress.
Reality
The CFTC sent a crypto rulemaking to the White House the same day, both agencies working from authority they already hold. A bipartisan group of state attorneys general is arguing the states should keep theirs.
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The Coinbase CEO says the Wall Street Journal is preparing to blame him for the CLARITY Act's Senate defeat, and he has put his own account of January on the record while the SEC and CFTC say they will write crypto's rules themselves.
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The Senate left the Clarity Act 11 votes short of the 60 needed on Tuesday. Bitcoin fell 4.5%, while Coinbase and Circle, the two firms that would have gained a primary regulator, fell 10.10% and 11.4%.
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Polymarket took the Clarity Act from about 14% to nearly 30% and back to 18%, and bitcoin's $79,586 high on September 14 unwound below $78,000 by the next morning. The down leg values full passage near 14%.
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Brett Redfearn, who ran the SEC's trading and markets division from 2017 to 2020, says the industry still cannot say who votes a tokenized share held in a wallet with no identity attached. His own firm whitelists every wallet it touches.
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Crypto teams have spent a year planning around a federal token rulebook that Polymarket now prices near 14%. The blocker is a provision about the president's family business, and no trade association can redraft its way past that.
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House leadership cancelled the last two September voting weeks, leaving the market-structure bill that crypto teams have been scoping features around without a scheduled path to the president's desk before the midterms.
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US debt crossed $40 trillion and the interest bill now tops Medicare. The buyback that helped move gold and bitcoin was $4 billion, or one hundredth of one percent of the stock.
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Chairman Michael Selig has told staff to work out what existing authority can carry. His innovation committee's first meeting produced no rule text and one candid caveat about enforcement.
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