New steps have been taken in the US to clarify the legal framework for cryptocurrency markets. The US Securities and Exchange Commission (SEC) has prepared and submitted to the White House interpretive guidance on how crypto assets can be assessed under existing securities laws. At the same time, the US Commodity Futures Trading Commission (CFTC) also initiated a new regulatory process regarding prediction markets.
SEC's Interpretive Guidance for Crypto Assets
The document prepared by the SEC and submitted to the White House is titled "Commission Commentary on the Application of Federal Securities Laws to Certain Types of Crypto Assets and Transactions Related to Those Assets." Submitted on March 3rd, this guidance is currently in the pre-regulatory review phase and undergoing interagency review. While the White House Office of Information and Regulatory Affairs (OIRA) has shared limited information about the interpretive guidance, according to Bloomberg, the work centers around a framework known as "token classification." This framework aims to determine under what conditions crypto assets will be considered securities and under what circumstances they may fall into a different category.
Such a classification system could directly impact many critical issues, such as how crypto companies register with regulators, what disclosure obligations they must fulfill, and how they interact with investors. It also aims to provide clearer answers to the long-debated question in the sector: "Which assets fall under the SEC's jurisdiction?"
It is accepted that such interpretive guidance prepared at the commission level has a stronger enforcement effect compared to opinions published by agency personnel. However, formal voting by commission members is generally not required for such documents.
Emphasis on regulation from the SEC Chairman
SEC Chairman Paul Atkins has listed digital asset regulations among the agency's priorities since the beginning of his term. In previous statements, Atkins stated that the ideal solution for crypto markets would be a comprehensive law to be prepared by Congress. However, he also stated that if the necessary regulation is not enacted, the SEC can take action within its own powers.
A comprehensive "market structure" law for crypto markets was planned to be prepared in the US. However, this bill failed to make progress in the Senate during the year. One of the biggest obstacles to the bill was the disagreement between the banking sector and crypto companies, particularly regarding the return models offered by stablecoins.
It is also known that the White House has recently been trying to resolve these differences by bringing together representatives from the banking and crypto sectors.
CFTC Focuses on Prediction Markets
On the other hand, financial regulatory bodies in the US are also turning to new areas that are not limited to crypto assets. The CFTC has submitted a regulatory study on prediction markets to OIRA.
This step also parallels the speech given by CFTC Chairman Michael Selig at the Future of Finance event organized by the Milken Institute. Selig announced that the institution will soon launch a comprehensive regulatory process for prediction markets.
According to Selig, the CFTC aims to clearly define which products can be self-certified in the market and which should be subject to stricter scrutiny. The institution also plans to create standards on how different products offered in prediction markets will be evaluated. A significant reason for this regulatory initiative is the differences in interpretation at the federal and state levels. Prediction markets, which offer contracts based on events such as sporting events, are considered under gambling laws in some states. Platforms like Kalshi and Polymarket have therefore faced sanctions and legal proceedings in various states. The CFTC aims to reduce these uncertainties and bring clearer rules to the market with the new regulation. Selig stated that the agency will publish new guidance very soon and that the industry should closely follow these developments.
