SEC vs CFTC: Who Will Regulate Your Crypto?

The two Senate playbooks — and why Washington can’t stop arguing

Washington has been doing its favorite thing again: debating who gets to tell crypto what to do. After the House moved a big crypto bill earlier this year, the Senate didn’t just pick a lane — it drafted two of them. Two separate Senate committees released competing plans that would redraw who watches spot markets, who checks exchange books, and who gets the final say on whether a token is a security or a commodity. Translation: your coins might end up answering to different rulebooks depending on how this shakes out.

One draft, put forward by the Agriculture Committee, hands a wider set of powers to the Commodity Futures Trading Commission. It would make spot crypto markets look more like traditional commodity venues: exchanges, brokers, and dealers would need to register; platforms would face new capital and custody rules; customer assets would be segregated and held by qualified custodians; and surveillance and reporting standards would be beefed up. Think more exchange reporting and market surveillance, less of the classic investor-disclosure playbook.

The Banking Committee has a different vibe. Their proposal leans into the Securities and Exchange Commission by creating a new category for tokens that sit in the murky middle — dubbed “ancillary assets” in their draft. Under this plan, tokens that are distributed in a package that looks like an investment contract would fall under SEC oversight. Issuers would need to disclose how tokens were distributed, how governance works, and what risks exist. There’s also a built-in mechanism for projects to earn their freedom: a decentralization checklist that, if satisfied, could let a token graduate out of securities treatment after a period of oversight and a rulemaking window.

What this means for traders, builders, and wallet-hoarders

If that felt like dry policy speak, here’s the juicy part: the practical fallout could be big. Move-overs in jurisdiction change how custody is handled, what exchanges must show, and how tokens are classified — and classification affects liquidity, compliance, and whether U.S. platforms can even list something without raising a regulatory eyebrow.

Under the Agriculture approach, Bitcoin-style spot markets would be regulated like other commodities markets, with heavier emphasis on reporting, surveillance, and standardized data-sharing between venues. ETFs would still sit with the SEC, but exchanges would now wear a commodity-exchange hat for spot crypto — meaning clearer surveillance and possibly better insight into market quality and liquidity.

Under the Banking approach, many enterprise-linked tokens could remain under SEC oversight until they prove they’re decentralized enough to escape. That “graduation” path tries to give projects a defined route out of securities status, but it also makes projects start under disclosure rules and investor protections before they can claim independence.

Either way, expect a messy transition: some platforms may need dual registrations, tighter capital rules, and cleaner trading records. DeFi largely stays on the menu for future debates, and both drafts rely on follow-up rulemaking and coordination — so nothing flips overnight. The deadlines and details matter, and both plans leave room for more arguments and amendments.

Bottom line: whether you trade, build, or just hoard crypto like a digital dragon, who draws the jurisdictional lines will shape custody rules, disclosure expectations, and how easy it is to list or trade a token in the U.S. Keep your eyes on the Senate drafts — not glamorous, but they’ll decide who gets the whistle and who keeps your coins safe (or at least under supervision).