CFTC Crypto Regulations Prepared for Senate Release Next Month
The U.S. Senate Agriculture Committee is set to release a discussion draft in early September 2025, outlining how the Commodity Futures Trading Commission (CFTC) would regulate the crypto industry alongside the Securities and Exchange Commission (SEC). This move is part of a larger process aiming to create a final market structure bill in conjunction with the Senate Banking Committee's draft.
Key points of the Agriculture Committee's draft include:
* **Regulatory jurisdiction:** The CFTC would have regulatory authority over digital commodities like Bitcoin and Ethereum, recognising them as commodities under its purview. Digital securities would remain under the SEC’s jurisdiction. * **Registration requirements:** The draft will propose new registration requirements for digital asset intermediaries (such as exchanges or custodians dealing with digital commodities), aiming to enhance oversight and market integrity. * **Stablecoins and DeFi oversight:** The draft will address regulatory frameworks for stablecoins and provide guidance on decentralized finance (DeFi) activities, focusing on how these platforms and protocols fit within the CFTC's remit, especially regarding derivatives and commodity trading. * **Bipartisan approach:** The Agriculture Committee is working towards a bipartisan draft, including input from members like Senator Amy Klobuchar (D), aiming to complement the Senate Banking Committee's SEC-focused crypto market structure bill. * **Context and coordination:** This draft will eventually be combined with the Banking Committee's bill—namely, the "Responsible Financial Innovation Act of 2025"—to form a comprehensive crypto market structure framework. It reflects a division where the SEC primarily regulates digital securities and the CFTC focuses on cryptocurrencies classified as commodities.
The upcoming draft proposes that the CFTC take charge of digital assets like Bitcoin and Ethereum, establishing registration regimes for intermediaries and providing specific regulatory clarity for stablecoins and DeFi platforms. The focus on digital commodities, stablecoins, and DeFi is aimed at enhancing user protection in these areas.
The draft bill may extend the CFTC's control to cryptocurrencies categorised as digital commodities, including Bitcoin and Ethereum. It is expected to be a 'discussion draft', meaning it's not final and could change after feedback. The release of the draft bill aligns with the White House's September deadline for action on digital asset rules after the signing of the GENIUS Act.
Both draft bills are bipartisan, with members from both major political parties involved in their creation, including Democratic Senator Amy Klobuchar. The Senate Agriculture Committee will outline the CFTC's powers in the crypto space, including what it can and can't regulate. The draft bill is planned to suggest regulations for stablecoins and decentralized finance (DeFi), two rapidly expanding sectors of the crypto industry.
- The CFTC, as proposed in the upcoming discussion draft, will regulate digital assets like stablecoins, Bitcoin, and Ethereum, offering a registration regime for intermediaries and providing specific guidance for DeFi platforms to enhance user protection.
- The Agriculture Committee's draft bill focuses on establishing regulatory jurisdiction over digital commodities, recognizing Bitcoin and Ethereum as such, while the SEC continues to oversee digital securities.
- The Senate Banking Committee's bill, the "Responsible Financial Innovation Act of 2025," is planned to primarily focus on digital securities, coordinating with the Agriculture Committee's draft to create a comprehensive crypto market structure framework.
- The release of the Agriculture Committee's discussion draft coincides with the White House's September deadline for digital asset rules, following the signing of the GENIUS Act.
- Bipartisan efforts are evident in the drafting of these bills, with Democratic Senator Amy Klobuchar, among others, contributing to the Agriculture Committee's efforts to provide appropriate policy-and-legislation for the crypto industry, including the emerging DEFi and stablecoin sectors, which are key components of the general-news landscape.
