After years of regulatory uncertainty and jurisdictional friction between federal agencies, the crypto industry may finally be on the cusp of getting the clarity it has long sought. SEC Chair Paul Atkins recently signaled that a comprehensive crypto market structure bill could reach President Trump’s desk within the year, potentially ending a prolonged period of legal ambiguity that has hindered institutional adoption and innovation in digital asset markets. The proposed legislation would establish clear boundaries between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), create standardized trading protocols, and introduce transparent reporting requirements—reforms that could reshape how digital assets are bought, sold, and held across the United States.
The Long Road to Market Structure Reform
The push for comprehensive crypto market structure legislation has occupied lawmakers’ attention for several years, driven by a fundamental problem: the existing regulatory framework was not designed with digital assets in mind. The SEC and CFTC have historically operated under separate mandates—the SEC oversees securities, while the CFTC regulates commodities and derivatives—but crypto tokens often blur these distinctions, creating overlapping and sometimes conflicting regulatory claims. This ambiguity has generated what industry observers call a “turf battle” between the agencies, where each stakes expansive claims to jurisdiction over different aspects of digital asset trading, custody, and capital raising.
The House took the first major step toward resolving this confusion by passing the Financial Innovation and Technology for the 21st Century Act (FIT21) in May 2024. Building on that foundation, the House advanced the Digital Asset Market Clarity Act (CLARITY Act) in July 2025, which offered what many industry participants viewed as a workable template for jurisdictional clarity. The bill proposes a three-tiered classification framework: digital commodities subject to CFTC oversight, investment contract assets regulated by the SEC, and permitted payment stablecoins supervised by banking regulators. This categorical approach has gained traction because it leverages existing regulatory infrastructure rather than creating entirely new oversight mechanisms.
A Clearer Division of Labor Between Regulators
At the heart of the market structure debate is a simple question: who should regulate what? The CLARITY Act and related Senate proposals answer this by granting the CFTC exclusive jurisdiction over anti-fraud and anti-manipulation enforcement in digital commodities, including spot and cash transactions. This represents a dramatic expansion of CFTC authority, since the agency currently has only limited power to police fraud in spot commodity markets. Under the proposed framework, intermediaries handling digital commodities—including crypto exchanges, brokers, and dealers—would be required to register with the CFTC and comply with listing standards, custody requirements, and surveillance obligations.
The SEC, by contrast, would maintain exclusive jurisdiction over issuers and issuances of investment contract assets, overseeing registration and reporting requirements as it does for traditional securities. Importantly, however, the SEC’s regulatory reach would narrow in certain respects. Secondary market trading of digital assets that qualify as investment contracts would largely be handled by the CFTC, a reversal of traditional securities regulation that underscores the legislative intent to position the CFTC as the primary spot market regulator for most crypto tokens.
For payment stablecoins—digital tokens designed to maintain stable value relative to government currencies—the framework assigns supervisory authority to banking regulators while preserving anti-fraud and anti-manipulation jurisdiction for both the SEC and CFTC depending on the venue where transactions occur. This hybrid approach reflects lawmakers’ recognition that stablecoins occupy a unique position between traditional payment systems and speculative assets.
What the Market Structure Bill Would Deliver
The proposed legislation would introduce several concrete regulatory improvements that have long been absent from U.S. crypto markets. First, exchanges and trading platforms would face standardized listing requirements and public information standards, creating a baseline of transparency that currently varies widely across the industry. Second, custody rules would be tightened significantly, with qualified custodians required to segregate customer assets and maintain strict audit trails—provisions designed to prevent the kind of exchange collapses that devastated retail investors in recent years.
Third, the bills would require clear disclosures about rewards and incentives paid in connection with crypto transactions, addressing a gap where exchanges and platforms often obscure the true economics of trading. Fourth, implementation provisions include an 18-month rulemaking schedule for the CFTC following enactment, providing a defined timeline for how new regulatory obligations would take effect. The CFTC would also receive fee authority and expedited hiring authority to build the technical expertise necessary to oversee digital commodity markets—a recognition that the agency currently lacks the scale to effectively supervise retail crypto trading on the massive scale that now exists.
Why Institutional Capital Matters
Industry groups have largely embraced the market structure bills as a pathway to attract institutional capital into digital asset markets. Pension funds, insurance companies, and family offices have historically stayed on the sidelines of crypto investing, citing regulatory uncertainty and custody concerns. A clearer federal framework with defined intermediary standards and customer protection rules could remove these barriers, potentially unlocking trillions of dollars in institutional demand. The bills are also seen as a way to establish U.S. regulatory credibility internationally, positioning American exchanges and platforms to compete globally for digital asset trading volume.
Caution and Unresolved Questions
Despite the optimism, many firms remain cautious about the bills’ potential impact. Several unresolved questions persist. Decentralized finance (DeFi) platforms, which operate without traditional intermediaries, remain a gray area—the market structure bills are focused primarily on traditional trading venues and custody providers. Developers and validators operating in DeFi environments worry about whether they could face liability under securities or commodities laws, creating a chilling effect on open-source software development. The industry has called for explicit safe harbors for developers and software providers, but such protections remain subject to debate.
Additionally, questions linger about whether the CFTC possesses the operational capacity to serve as the primary regulator of a multi-trillion-dollar retail crypto market. Historically, the CFTC has focused on derivatives trading between sophisticated institutional participants, not mass-market spot trading. While the proposed bills grant fee and hiring authority, questions persist about whether these tools will prove sufficient for the scale of oversight required.
The Timeline and Political Obstacles
Atkins’ statement that the bill could reach Trump’s desk this year represents an optimistic scenario, but analysts suggest the odds of passage in 2026 stand at roughly 50 to 60 percent. Several political obstacles could derail momentum. Midterm election calendars tend to compress legislative windows, and debates over the speed of enactment versus the need for careful detail could create delays. Some lawmakers worry that moving too quickly risks leaving regulatory gaps that require future fixes, while others argue that prolonged uncertainty continues to harm the industry and invites regulatory chaos at the state level.
The House has already acted with the CLARITY Act, but the Senate version—anchored by work from the Senate Agriculture Committee—remains under discussion. Reconciling House and Senate versions could consume months of negotiation, potentially pushing final passage into 2027. The Trump administration’s pro-business stance and interest in fostering innovation could prove supportive, but regulatory philosophy matters less than legislative math, and securing 60 votes in the Senate remains a significant hurdle.
What Comes Next
As the crypto industry waits for clarity on market structure, both the SEC and CFTC are moving forward with administrative actions that preview the shape of future regulation. The SEC has established a crypto task force and issued guidance on how various digital asset activities fit within its jurisdiction, while the CFTC has signaled its intent to extend supervisory authority over spot crypto markets through existing exemptive authority if legislative action stalls. This regulatory momentum suggests that even if the market structure bill faces delays, the jurisdictional framework it proposes is likely to become reality in some form.
For the crypto industry, the message is clear: comprehensive federal market structure legislation is no longer a distant prospect but an imminent probability. Whether it arrives in 2026 or 2027, the era of regulatory ambiguity appears to be drawing to a close, ushering in a new chapter defined by standardized oversight, clearer intermediary requirements, and—if all goes well—a pathway for institutional capital to enter digital asset markets on a meaningful scale.
