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Bipartisan Legislation Assigns Crypto Regulation to CFTC to Clarify Oversight Uncertainty

Bipartisan Legislation Assigns Crypto Regulation to CFTC to Clarify Oversight Uncertainty

Bitget-RWA2025/11/11 05:40
By:Bitget-RWA

- U.S. lawmakers propose shifting crypto regulation from SEC to CFTC via a bipartisan bill, reclassifying most digital assets as commodities. - The draft aims to resolve regulatory ambiguity stifling innovation, building on stalled House CLARITY Act efforts during the 38-day government shutdown. - Market optimism surged as shutdown relief pushed Bitcoin above $105k, with ETF outflows persisting amid anticipation of clearer CFTC-led oversight. - Critics warn of CFTC resource constraints, while proponents hi

The regulatory environment for cryptocurrencies in the United States is experiencing a significant transformation as lawmakers from both parties propose shifting oversight from the Securities and Exchange Commission (SEC) to the Commodity Futures Trading Commission (CFTC). Senators John Boozman (R-Ark.) and Cory Booker (D-N.J.) have introduced a draft bill that would make the CFTC the chief authority over spot digital commodity markets, effectively categorizing most cryptocurrencies as commodities instead of securities

. This initiative responds to industry calls for more transparent regulation and is intended to clear up the jurisdictional confusion that has hindered both innovation and investor trust .

This legislative effort builds upon the CLARITY Act, which was previously approved by the House to clarify crypto regulation but was put on hold during the 40-day federal government shutdown that started in late October

. Throughout the shutdown, agencies such as the SEC and CFTC operated with skeleton crews, pausing reviews for crypto ETFs and stalling important legislative developments . The shutdown, which stemmed from partisan disagreements over healthcare funding, brought economic activity to a standstill and resulted in estimated weekly losses of $10–$30 billion, further increasing market uncertainty .

Bipartisan Legislation Assigns Crypto Regulation to CFTC to Clarify Oversight Uncertainty image 0
As lawmakers approach a resolution to the shutdown, the crypto market has started to rebound. , which had declined from previous peaks due to regulatory uncertainty, climbed above $105,000 after news broke of a Senate agreement to reopen the government . This deal, pending final approval in the House, has eased investor concerns and triggered a widespread rally across digital currencies. Assets such as (ETH), (SOL), and experienced renewed demand, with institutional investments and DeFi activity fueling the recovery .

The Senate’s proposed legislation highlights a growing agreement that the SEC’s enforcement-centric strategy has impeded the development of the crypto sector. By transferring regulatory duties to the CFTC—an agency with a background in commodities—the bill aims to foster innovation while ensuring consumer safeguards

. Supporters believe the CFTC’s experience with markets like oil and gold offers a solid foundation for digital assets, though some critics caution that the agency may face resource limitations . The draft also calls for increased staffing and funding for the CFTC to keep pace with the fast-changing crypto industry .

Market observers are paying close attention to how this regulatory shift could affect ongoing ETF approvals. The CFTC’s expanded oversight of spot markets may simplify the approval process for crypto ETFs, though there are still unresolved questions regarding the regulation of staking services and stablecoins

. With the government shutdown winding down and regulatory clarity in sight, analysts predict the sector could experience a “buy the dip” rally, especially if ETF launches accelerate .

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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