Crypto Framework Moves to White House Review as CLARITY Act Stalls

The Commodity Futures Trading Commission submitted a proposed framework covering crypto transactions and markets to the White House for review on Sept. 17, moving ahead with rulemaking under its existing authority. The filing landed two days after the Senate failed to advance the CLARITY Act in a 49-50 procedural vote, and it does not create effective rules on its own – the proposal still requires further CFTC action before it can take effect.

CFTC Crypto-Asset Rulemaking Enters White House Review

According to a filing with the Office of Information and Regulatory Affairs, the CFTC submitted a rule titled “Regulation Crypto Asset Transactions and Regulation Crypto Asset Markets” on Sept. 17. OIRA sits inside the Office of Management and Budget and reviews significant federal regulations before agencies can move toward publication, a standard checkpoint that now applies to independent agencies including the CFTC and SEC under the current administration.

Details of the proposal have not been released, and the CFTC declined to comment on its contents. That means the substance of the framework – what gets classified as a digital commodity, how exchanges might register, what leverage limits could apply – remains unknown outside the agency. The filing simply opens an executive review process that could result in changes before the measure is returned to the commission, a dynamic explored in more detail in prior coverage of the CFTC’s existing rulemaking authority.

Critically, the proposal must return to the CFTC for a vote before publication and before any public comment period opens. Recent CFTC registration relief for software developers shows the agency has been willing to use interim, narrower tools while a full framework works its way through review – this filing is the more permanent version of that same strategy.

Regulatory Stakes After the CLARITY Act Vote

The timing is not incidental. The Senate’s failure to advance the Digital Asset Market CLARITY Act – which fell short of the 60 votes needed to begin debate – left the SEC and CFTC to keep developing digital asset rules through their existing statutory powers rather than a new congressional mandate. The CLARITY Act would have established statutory divisions between the two agencies and created registration requirements for crypto trading platforms and other market participants, with qualifying digital commodities and their spot markets falling primarily under CFTC oversight while securities-related activity stayed with the SEC.

CFTC Chair Michael Selig had already prepared for the possibility that Congress would not finish the legislation. At an agency event on Aug. 20, he said he had directed staff to examine how the CFTC could codify a market structure for crypto assets using powers it already holds. Under that framework, existing CFTC registrants and currently unregistered crypto exchanges could potentially be designated as a type of designated contract market known as a crypto asset market – a designation that could let those venues offer leveraged or margined crypto trading under CFTC rules rather than waiting for statute.

Seven Senate Democrats who opposed cloture have since indicated that negotiations could continue, so the legislative track isn’t dead, just stalled. Ethics provisions tied to elected officials’ digital asset holdings and disputes over developer protections for noncustodial software have been among the sticking points, and those same issues will shape whatever the CFTC eventually proposes on its own. Readers tracking the legislative side can follow the broader CLARITY Act negotiations and proposed CFTC registration structure for the fuller picture.

What Comes Next for the CFTC Framework

The procedural path from here is straightforward but slow. OIRA must complete its review before the measure can return to the CFTC, the commission must then vote before the proposal can be published for public comment, and after publication the agency would collect comments and could revise the framework based on that feedback. A final rule would require another commission vote before taking effect – meaning traders shouldn’t expect operational changes to exchange registration or leverage rules anytime soon.

The agency isn’t standing still while that process plays out. On Sept. 17, CFTC staff issued a no-action position covering certain qualifying passive software providers, meaning staff will not recommend enforcement action against developers who meet 10 specified conditions for connecting users to registered derivatives markets without registering as introducing brokers. The same day, the SEC released its own long-anticipated innovation exemption for eligible tokenized securities activity, giving certain onchain trading models a regulatory route to operate – a parallel signal that both agencies are filling gaps left by the stalled legislation rather than waiting on Congress.

One structural wrinkle worth watching: Selig is currently the sole commissioner on a body designed to have five members, and the CFTC’s headcount dropped from roughly 708 employees a year earlier to about 556 at the end of fiscal 2025. That leaves a single vote steering the agency’s entire crypto agenda through OIRA review, a commission vote, a comment period, and a final vote – a lot of process resting on one office while the vacancies remain unfilled.

For now, the framework sits with the White House, not the public. Follow CoinNews on X and Telegram for updates as the CFTC’s crypto market structure proposal moves through review.