CFTC Chair directs staff to draft crypto market rules if Clarity Act fails in Senate
Commodity Futures Trading Commission Chairman Michael S. Selig has directed staff to draft a contingency regulatory framework for crypto markets using existing authorities if the Clarity Act fails to pass the U.S. Senate. The proposed rules would establish a "crypto asset market" designation allowing registered and unregistered exchanges to offer leveraged trading. This move comes as the Clarity Act faces a tight three-week voting window in the Senate, stalled by partisan disputes over ethics provisions.
CFTC contingency rulemaking directive
▪Commodity Futures Trading Commission Chairman Michael S. Selig directed agency staff to explore rules to codify a crypto market structure using existing authorities if Congress fails to pass the Clarity Act
▪CFTC Chairman Michael S. Selig announced the contingency rulemaking directive on August 20, 2026, during the inaugural meeting of the CFTC's Innovation Advisory Committee
Clarity Act legislative status
▪The advancement of the Clarity Act is delayed in part by disagreements over a revised ethics provision proposed by Senators Ruben Gallego and Thom Tillis addressing the Trump family's crypto investments
▪The Clarity Act is currently stalled in the U.S. Senate, where it faces a final three-week voting window to secure the 60 votes needed to pass
Proposed crypto asset market framework
▪The proposed CFTC framework would allow registered and unregistered crypto exchanges to be designated as a "crypto asset market" to offer leveraged or margined trading under tailored rules
▪The CFTC is preparing to modify Rule 40.11 to modernize corporate and listing rules for designated contract markets that list event contracts, including prediction markets
Developer protocol compliance engagement
▪CFTC Chairman Michael S. Selig directed staff to engage with developers of on-chain finance protocols to establish legal and compliant pathways for their operations in the United States
▪During a Wednesday press conference, President Donald Trump stated that CFTC Chairman Michael S. Selig is working to bring the decentralized perpetual futures exchange Hyperliquid into the United States
Interagency coordination with SEC
▪CFTC Chairman Michael S. Selig is collaborating with SEC Chairman Paul Atkins through Project Crypto to develop a digital asset classification system
▪The SEC proposed Regulation Crypto Assets on August 18, 2026, to establish a safe harbor policy and reduce regulatory hurdles for crypto startups and fundraising
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