DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.

State and federal regulators are racing to fill a widening gap in U.S. cryptocurrency oversight after the Clarity Act stalled in the Senate. The proposed legislation had been designed as a comprehensive framework for digital assets.

Only two days after the measure failed to advance, the Securities and Exchange Commission expanded its crypto rulebook through its existing authority. The agency issued an order establishing a temporary pathway for trading certain tokenized stocks, moving financial markets closer to 24/7 trading.

The Commodity Futures Trading Commission moved on the same day, submitting a crypto rulemaking proposal to the White House for review. The proposal’s details were not disclosed, although an Office of Management and Budget post confirmed that the rules were awaiting review.

The crypto industry had supported the Clarity Act and continues to seek regulatory guidance for the developing market. Industry participants have also worked to shape the regulatory environment as digital assets become more closely connected with traditional finance.

Summer Mersinger, CEO of the Blockchain Association and a former CFTC commissioner, said uncertainty is holding back participation. “When you’re thinking about traditional finance entering in and using some of this technology, they’re being held back right now because there is this regulatory uncertainty,” she said.

Mersinger argued that clearer standards could expand investment and adoption. “Having the regulators provide some sort of certainty is going to really open up the industry to more investment, more integration into traditional finance, and really grow the sector.”

Coinbase CEO Brian Armstrong, a key industry figure urging congressional action on the Clarity Act, signaled impatience after the failed Senate procedural vote on Sept. 15. “At this point, I don’t think we can wait on Congress and the Senate,” Armstrong told CNBC.

Senate Banking Committee Chairman Tim Scott also urged federal agencies to establish “clear rules of the road” for digital assets while Congress works on legislation. Even so, creating new regulations through federal agencies can be a lengthy process.

Asked how it intends to regulate crypto, the CFTC referred CNBC to a Sept. 16 statement from Chair Michael Selig. “President Trump promised to deliver a future-proof crypto asset regulatory market structure one way or the other, and we will help him get the job done using our existing statutory authorities,” Selig said.

CNBC also asked the SEC about its next steps for the digital asset industry. A spokesperson said the agency would consider a proposal to “modernize the rules around custody of investment adviser client assets and fund assets, including to address crypto assets.”

Caroline Pham, who served as acting CFTC chair from the start of President Donald Trump’s second term until December, said agency action had long been considered. “A plan B to move forward at the agency level was always in the cards,” she told CNBC.

Pham is now CEO of MoonPay Institutional and serves as chief legal officer and chief administrative officer for MoonPay, a crypto services provider. She said the CFTC and SEC accounted for that possibility in their work after Trump’s second term began.

“You have to have a contingency plan,” Pham said. That work includes Project Crypto, an initiative introduced in July 2025 to modernize securities regulations and align the crypto rules enforced by the SEC and CFTC.

In August 2025, Pham announced that the CFTC would begin implementing recommendations from the President’s Working Group on Digital Asset Markets. The agencies’ latest moves suggest regulators are using their current statutory powers while the congressional effort remains unsettled.

States are also pressing their case for authority over the asset class. In a Sept. 14 letter, a bipartisan coalition of state attorneys general urged the Senate Banking Committee to oppose the Clarity Act, arguing that it would displace state power over securities markets.

“We write to urge the Senate to expressly preserve the police powers of the states and ensure that the states remain armed with the tools necessary to protect the American people from predatory scammers,” the coalition wrote to Scott and Sen. Elizabeth Warren of Massachusetts.

Aaron Klein, a senior fellow in economic studies at the Brookings Institution and a former senior Senate Banking Committee staff member, argued that national and international capital markets require federal regulation. He said states retain substantial authority to stop fraud and scams.

Klein said states should more aggressively monitor payment processing and prosecute criminals when no federal crypto framework exists. Mersinger countered that state enforcement generally arrives only after a crime has occurred and someone has potentially suffered harm.

The midterm election is now drawing greater attention, but lawmakers have not entirely abandoned the Clarity Act. Sen. Thom Tillis revised his vote to oppose the legislation, a procedural step that allows him to bring a motion asking the Senate to reconsider it.

DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.