SEC and CFTC Prepare to Fill the Crypto Rulebook After CLARITY Act Setback

The CLARITY Act may have stalled in the Senate, but that does not mean crypto regulation in the United States is standing still. Analysts at Bernstein expect the Securities and Exchange Commission and Commodity Futures Trading Commission to respond with an “aggressive and swift” round of rulemaking.

The shift matters because the Digital Asset Market Clarity Act was supposed to create a lasting federal framework for the crypto industry. Instead, the bill failed to clear a procedural Senate vote, receiving 49 votes in favor and 50 against. It needed 60 votes to advance.

With Congress unable to move the legislation forward, the responsibility for defining the next phase of US crypto oversight is falling back to the federal agencies.

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Regulators Are Expected to Move Quickly

Bernstein analysts believe the SEC and CFTC will pursue more targeted rules to compensate for the time spent waiting on congressional negotiations. The expected agenda could cover some of the most important unresolved questions facing the industry, including how native crypto tokens should be classified and which protections should apply to decentralized finance developers and self-custody infrastructure.

The agencies could also address equity tokenization, approvals for perpetual futures tied to real-world assets, and coordination over single-stock perpetual contracts. Bernstein additionally expects possible changes to how federal sports-event contracts are treated under derivatives rules.

These are not small technical questions. The answers could determine which products exchanges are allowed to list, how token issuers raise capital, and whether developers can build decentralized applications without being treated like traditional financial intermediaries.

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Agency Rules Are Not the Same as Federal Law

The SEC and CFTC have already demonstrated that they are willing to act without waiting for Congress. In March, the agencies issued a joint interpretation explaining how federal securities and commodities laws apply to certain crypto assets. The SEC has also proposed a specialized fundraising framework that would provide exemptions and a conditional safe harbor for qualifying crypto projects.

That approach can give companies useful guidance, but it cannot fully replace legislation. Agency rules and interpretations remain exposed to court challenges and can be revised or withdrawn by a future administration. A law passed by Congress would provide a more durable division of authority between the SEC and CFTC.

This is the central tradeoff following the failed Senate vote. The industry may receive faster answers from regulators, but those answers could carry less long-term certainty than the framework envisioned under the CLARITY Act.

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Stablecoin Rewards Remain in Place

The failed vote also leaves the current stablecoin-rewards environment largely unchanged. Bernstein noted that the proposed compromise would have restricted rewards paid on idle stablecoin balances by requiring them to be connected to customer activity.

Without the legislation, platforms such as Coinbase can continue offering rewards on idle balances under the existing framework. Stablecoins themselves remain covered by the GENIUS Act, although questions surrounding rewards, affiliates, and the law’s prohibition on issuer-paid yield may still produce regulatory disputes or litigation.

For crypto platforms, that preserves an important source of customer incentives. For banks and regulators, it leaves an unresolved competitive question about products that can resemble interest-bearing deposits without being regulated in exactly the same way.

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What This Means for Crypto

The immediate takeaway is not that US crypto regulation has disappeared. It is that the process is moving from Congress back to the regulators.

That could produce faster progress on individual issues, especially token classification, DeFi protections, custody, tokenization, and derivatives. It may also provide companies with enough guidance to launch products that have remained on hold because of regulatory uncertainty.

However, investors and businesses should keep the difference between regulation and legislation in mind. SEC and CFTC action could improve the operating environment during the current administration, but it will not necessarily provide the permanent legal foundation the industry wanted from the CLARITY Act.

Crypto may still get clearer rules. The bigger question is how long those rules will last.