U.S. Announces Clear SEC-CFTC Crypto Oversight Split to Boost Market Clarity

The U.S. government has taken a major step toward clarifying the regulatory landscape for digital assets, with the Trump administration releasing a comprehensive cryptocurrency policy report in July 2025. The report outlines a clear division of authority between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), aiming to resolve longstanding jurisdictional disputes and provide a stable regulatory foundation for the fast-growing crypto industry [1]. Under the new framework, the CFTC will oversee spot markets for non-security digital assets, while the SEC will continue to regulate digital securities [2]. This move is intended to eliminate overlapping enforcement and create a more coherent legal environment for market participants [3].

The policy recommendations stem from a six-month review initiated by a January executive order, and they reflect a broader effort to strengthen U.S. leadership in digital financial technology. The 160-page report includes guidance on fostering decentralized finance (DeFi) innovation, modernizing banking regulations, and banning central bank digital currencies (CBDCs) at the federal level. It also calls for the Federal Reserve to increase transparency in its master account access process, a move seen as critical to addressing concerns raised by banks involved in digital asset activities [4].

To implement the recommendations, the CFTC and SEC have launched a joint initiative known as the “Crypto Sprint.” This collaborative effort seeks to streamline regulatory reforms and enhance market transparency, addressing persistent ambiguities that have hindered institutional participation in crypto markets [1]. The CFTC, in particular, is expanding its role beyond derivatives to include direct oversight of spot markets for non-security digital assets. This reflects a broader shift in U.S. policy toward a more active regulatory presence in the digital asset space [5].

The SEC, meanwhile, has introduced its own initiative, “Project Crypto,” led by Chairman Paul S. Atkins. The project aims to modernize securities regulation for on-chain financial markets, support the tokenization of assets, and provide clearer guidelines for the classification of crypto assets [6]. It also emphasizes the need to update custody rules and enable the development of integrated trading platforms, underscoring the convergence of digital and traditional financial systems.

Regulatory clarity is also seen as a critical component in maintaining the U.S. dollar’s global dominance, especially in the context of stablecoins and the threat posed by foreign CBDCs. The report supports the implementation of the GENIUS Act to establish a federal framework for stablecoin regulation and urges the Federal Reserve to take steps to prevent digital assets from being used for illicit finance while preserving self-custody rights [4]. Additionally, it calls for a fair tax treatment of digital assets, treating them as a distinct asset class to reduce compliance burdens for investors and issuers.

The division of authority between the CFTC and SEC is expected to have far-reaching implications for the structure of digital asset markets. By assigning the CFTC oversight of spot markets for non-security tokens, the White House aims to reduce regulatory overlap and create a more coherent framework for market participants. This could lead to greater clarity in enforcement actions and reduce the risk of conflicting interpretations of securities and commodities laws [2]. However, some industry observers caution that the distinction between digital commodities and digital securities may become increasingly blurred as the technology evolves [3].

The Crypto Sprint and related initiatives represent a broader effort to position the U.S. as a global leader in digital finance. By implementing these reforms, the government aims to attract innovation, investment, and talent to the domestic market, reinforcing its competitive edge in the digital economy. The success of these efforts will depend on the ability of regulators to balance innovation with investor protection and financial stability.

Source:

[1] CFTC Launches Crypto Sprint to Implement White House Digital Asset Reforms (CoinCentral), https://coincentral.com/cftc-launches-crypto-sprint-to-implement-white-house-digital-asset-reforms/

[2] SEC-CFTC Role Sharing, Potential to Ease Uncertainty in Digital Markets (eblockmedia.com), https://www.eblockmedia.com/news/articleView.html?idxno=25240

[3] surrenders" to encryption, DeFi has its securities law (PANews), https://www.panewslab.com/en/articles/c546fdf0-0827-4af9-b436-013b4312d66d

[4] President’s Working Group on Digital Asset Markets Recommendations to Strengthen American Leadership in Digital Financial Technology (White House), https://www.whitehouse.gov

[5] Here's what happened in crypto today (Cointelegraph), https://cointelegraph.com/news/what-happened-in-crypto-today

[6] U.S. Securities and Exchange Commission (SEC) launches Project Crypto (SEC), https://www.sec.gov