The Commodity Futures Trading Commission (CFTC) has revised its regulatory guidelines, now permitting registered cryptocurrency brokers and clearinghouses to invest client assets in tokenized
The Commodity Futures Trading Commission (CFTC) has revised its regulatory guidelines, now permitting registered cryptocurrency brokers and clearinghouses to invest client assets in tokenized versions of approved financial instruments under specific conditions.
On Thursday, the CFTC released an updated policy framework building on initial guidance from March. The announcement outlines how registered crypto firms may be allowed to use tokenized asset versions, provided the tokens deliver identical legal and economic rights as traditional equivalents.
The new policy also confirms that regulated firms can maintain records on blockchain-based systems. CFTC Chairman Michael Selig emphasized the regulatory agency’s goal of bringing more clarity to the crypto sector through these modifications.
Approved companies may allocate client funds to tokenized alternatives if the digital form matches the original instrument’s legal protections and economic structure. The CFTC does not oppose maintaining records using blockchain technologies as long as these standards are met.
This regulatory step broadens the range of instruments eligible for tokenization, creating opportunities for efficiency and transparency in asset management for crypto-focused firms.
The CFTC’s revised guidance follows a recent setback in the US Senate, where lawmakers failed to move forward with the Digital Asset Market Clarity Act. The proposed legislation had been intended to clarify the boundaries of oversight between the CFTC and the Securities and Exchange Commission (SEC) in the digital asset space.
Industry analysts now expect Congress will not pass major legislation to define crypto market structure until at least 2027. In light of stalled legislative progress, federal regulators like the CFTC and SEC are moving ahead with crypto rulemaking by applying current statutory powers.
The CFTC has already submitted a market oversight strategy to the White House. The SEC issued an order after the legislative defeat, establishing a temporary framework for trading tokenized securities.
SEC Chairman Paul Atkins previously signaled his agency’s readiness to establish independent guidelines for cryptocurrency trading, even in the absence of legislative direction from Congress. The SEC has outlined proposals to regulate specific digital investment contracts.
The crypto industry has mostly supported the CLARITY Act. Coinbase CEO Brian Armstrong argued after an earlier Senate defeat that the sector could not afford to wait for legislation. Summer Mersinger, Blockchain Association CEO and former CFTC commissioner, suggested that clearer rules would stimulate mainstream adoption and draw further investment into digital assets.
However, the bill met with resistance at the state level. Attorneys general from several states wrote to the Senate Banking Committee objecting to the potential loss of their enforcement authority over securities markets. They argued that state governments must retain powers to protect consumers from fraud.
Aaron Klein of the Brookings Institution countered that federal oversight best serves capital markets, while states should focus on prosecuting criminal fraud cases. Mersinger noted state action typically follows after wrongdoing, calling for preemptive federal supervision.
Although Senator Thom Tillis voted against the bill, this procedural move preserves his ability to request a future vote and potentially revive the legislation.
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