The Zhitong Finance App learned that after the comprehensive crypto regulation proposal “Clarity Act” (Clarity Act) ran aground in the Senate, US federal and state regulators are scrambling to fill the digital asset regulatory vacuum. Just two days after the Clarity Act failed to advance in the Senate, the US Securities and Exchange Commission (SEC) expanded its crypto regulatory rulebook with existing powers. The agency issued an order to create temporary channels for certain tokenized stock transactions, moving the financial market one step closer to round-the-clock trading. On the same day, the US Commodity Futures Trading Commission (CFTC) submitted a crypto rulemaking proposal to the White House for review. Details of the proposal were not disclosed, but an announcement from the White House Office of Management and Budget (OMB) confirmed that the relevant rules are still pending review.
The crypto industry, which has supported the Clarity Act, said it is desperate for regulatory guidance for this emerging industry and has been working to shape a regulatory environment that suits its own interests.
Summer Mersinger, CEO of the Blockchain Association and former CFTC member, said: “When traditional finance is considering entering and using some cryptography, they are currently constrained by regulatory uncertainty. Regulators provide some certainty that will really open up more investment for the industry, integrate more deeply into traditional finance, and drive growth in the sector.”
Coinbase CEO Brian Armstrong is a key industry figure urging Congress to act on the Clarity Act. “As of now, I don't think we can wait for Congress and the Senate,” he told CNBC after losing the Senate procedural vote on September 15. South Carolina Republican Senator Tim Scott, chairman of the Senate Banking Committee, also called on federal agencies to establish “clear rules of the road” for digital assets before Congress legislates.
But federal agencies' new regulations didn't happen overnight.
When asked how it plans to regulate crypto, the CFTC quoted Chairman Michael Selig's statement on September 16. “US President Trump promised to deliver a future-oriented crypto asset regulatory market structure no matter what, and we will use our existing statutory authority to help him complete this work,” Seliger said.
Foreign media also contacted the SEC regarding the next steps to regulate the digital asset industry. A spokesperson said the agency would consider a proposal to “modernize the escrow rules for investment advisor client assets and fund assets, including the handling of crypto assets.”
Caroline Pham served as acting chairman of the CFTC from the day Trump took office for his second term until December. “Plan B, which is being promoted at the institutional level, is always under consideration,” she told CNBC. Pham is currently CEO of crypto service provider MoonPay Institutional and also serves as MoonPay's Chief Legal Officer and Chief Executive Officer.
“You have to have a contingency plan,” she said. She explained that since the beginning of Trump's second term, the CFTC and SEC have been advancing related work and taking this into account. This includes the “Project Crypto” program launched in July 2025 to modernize securities regulation and harmonize SEC and CFTC cryptographic rules.
In August 2025, Pham announced that the CFTC would begin implementing the recommendations of the President's Digital Asset Markets Task Force.
States target crypto scams
As the US struggles to push ahead with crypto regulation, states are also vying for regulatory rights in this asset class.
In a September 14 letter, a bipartisan coalition of state attorneys general urged the Senate Banking Committee to oppose the Clarity Act, arguing that it weakens states' ability to regulate the securities market.
In a letter to Scott and Massachusetts Senator Elizabeth Warren, the Democratic Party's chief member of the committee, they said, “We are writing to urge the Senate to clearly preserve security rights in all states and ensure that states still have the necessary tools to protect Americans from predatory fraudsters.”
Aaron Klein, a senior economic researcher at the Brookings Institution, said he believes states are not the best agents to regulate domestic and international capital markets.
Klein, a former senior member of the Senate Banking Committee, said, “Capital market regulation should be done at the federal level. But states have a lot of power when it comes to fighting fraud and scams.”
In the absence of a federal crypto framework, states should be more active in monitoring payment processing and prosecuting criminals, he said.
Mersinger notes that state law enforcement only steps in after a crime has already been committed.
She said, “What we really need is supervision at the federal level to ensure this doesn't happen: because lawbreakers are involved or residents in the state are harmed in some way, the state attorney general has to step in and file a lawsuit.”
The midterm elections are now in the spotlight, but lawmakers have not completely abandoned the Clarity Act. Republican Senator Tom Tillis of North Carolina instead voted against it, so he can move to reconsider the bill.