The CFTC Is Writing Crypto Rules the Senate Just Refused to Pass

The Senate just refused to advance the CLARITY Act, and the CFTC is already trying to build a crypto rulebook without waiting for Congress.

The crypto industry wanted one federal law. It got a failed cloture vote instead. On September 15, the Senate rejected cloture on the motion to proceed to H.R. 3633, the Digital Asset Market Clarity Act, by 49 to 50, according to the Senate roll call. Two days later, the Commodity Futures Trading Commission sent a crypto rulemaking package to the White House's Office of Information and Regulatory Affairs. The filing's title is dry: Regulation Crypto Asset Transactions and Regulation Crypto Asset Markets. The signal isn't.

If Congress won't write the rules, the regulator will try.

The Bill Broke in Public

The CLARITY Act wasn't a fringe bill. It was the crypto industry's main shot at moving digital asset market structure into statute, with the CFTC taking a larger role and the SEC pulled back from parts of the market. The House had already passed H.R. 3633, and the Senate vote was only about opening debate. It still failed.

The official count tells you how badly the coalition cracked. Every voting Democrat opposed cloture. Chris Coons of Delaware didn't vote at all. Three Republicans went with them: Susan Collins, Josh Hawley and Jerry Moran, all voting no. So did Thom Tillis, who had been part of the negotiations around stablecoin rewards. A bill that needed 60 votes got 49.

That's not a scheduling problem. That's a political defeat.

Ethics did much of the damage. AP reported this week that Democrats pushed back over President Donald Trump's crypto interests, including World Liberty Financial revenue and the broader question of whether a sitting president should benefit from a market structure bill his own regulators would then implement. The Wall Street Journal reported that Trump earned more than $1.4 billion from crypto ventures last year, a figure that turned the bill from a market plumbing fight into a conflict of interest fight.

There was also a business fight underneath it. The Block reported earlier this year that Coinbase booked $1.35 billion in stablecoin revenue in 2025, much of it tied to USDC distribution and rewards. Banks hated the idea of crypto platforms paying customers rewards on stablecoin balances while operating outside the deposit rules banks live under. You don't need to love the banking lobby to see the problem. Stablecoin yield is not a small side issue when one of the industry's most important public companies has that much money riding on it.

The CFTC Moves Anyway

OIRA's public docket shows the CFTC submission arrived on September 17 under RIN 3038-AF80. It is listed at the prerule stage. That means there is no published rule text, no comment deadline and no effective date. Anyone telling you the CFTC has already rewritten crypto markets is getting ahead of the paperwork.

Still, the filing didn't come out of nowhere. In August remarks published by the CFTC, Chairman Michael S. Selig said he had directed staff to explore rules that could create a CFTC market structure for crypto assets under the agency's existing authority. His remarks pointed to a model that could let current registrants and crypto exchanges seek designation as a type of designated contract market, or DCM, for crypto trading done on margin or with borrowed money.

That is a real path. It is also narrower than what the CLARITY Act would have done.

The CFTC can regulate derivatives markets. It can oversee registered contract markets. It can police fraud and manipulation in commodity spot markets. What it can't do, under current law, is simply declare full federal authority over ordinary spot trading in bitcoin, ether or other tokens on every exchange. Congress would have to give it that job. The Senate just declined to start that conversation.

This is why the CFTC route looks both powerful and limited: powerful because a formal rulemaking is harder to dismiss than another enforcement theory, limited because it still has to grind through notice and comment, White House review and a full commission process. It also takes time - a lot of it. According to The Block's reporting on the OIRA filing, the rulemaking could point toward a late 2027 timeline at the earliest.

The Industry Gets Delay, Not Clarity

For Coinbase, Kraken, token issuers and trading firms, the practical result is a longer wait. The current mix stays in place. State licenses, federal agency interpretations, no-action letters and court fights - nothing about that changes. The CFTC may build a new lane for registered venues. It can't give the whole market the clean federal map the bill promised.

Look at what the failed vote leaves behind. The SEC has already proposed its own Regulation Crypto Assets, published in the Federal Register on August 21, with comments due October 20. The CFTC now has a separate package sitting at OIRA. The Senate has a failed vote on the record. That is not clarity. It's a queue.

The industry spent years arguing that regulation by enforcement was the wrong way to govern crypto. Fair enough. But regulation by agency workaround isn't the same as a statute either. It can help exchanges that are willing to register, build systems around CFTC rules and accept federal supervision. It won't settle the bigger fight over where digital assets sit in American financial law.

You can see the shape of Washington's answer now. Congress couldn't get the votes. The CFTC won't sit still. The SEC is already writing its own rulebook. Crypto asked for one clean framework and got three moving parts instead.

That's the real cost of the Senate vote. The bill died in one afternoon, but the rulemaking process it left behind could run well into 2027.

Also read: South Korea's NH Investment Backs Evernorth's XRP Treasury With $30 Million • Robinhood Chain's Weekend Trading Volume Just Hit $1.01 Billion • Bastion Wins Conditional OCC Approval for a National Trust Bank Charter

This article is posted in Crypto News, check it out for more related stories.