Author: John
Author Bio: John is a financial and cryptocurrency news writer covering digital assets, blockchain regulation, market developments and the policies shaping the global crypto industry.
Publish Date: October 8, 2026
U.S. lawmakers are once again highlighting the need for legislation to establish clearer and more permanent rules for the cryptocurrency industry. French Hill, chairman of the U.S. House Financial Services Committee, has said that regulatory action by the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) cannot permanently replace legislation from Congress.
Hill’s comments come after the U.S. Senate failed to advance the CLARITY Act in September. He has continued to argue that Congress needs to establish a statutory framework that provides lasting legal certainty for digital assets, businesses and consumers.
French Hill Calls for Congressional Action
Hill has emphasized that federal regulators can use their existing authority to provide guidance and develop rules for the crypto sector, but legislation remains necessary for a permanent market structure framework.
Following the Senate’s September 15 failure to advance the CLARITY Act, Hill and House Agriculture Committee Chairman Glenn “GT” Thompson said that the vote did not remove the need for Congress to establish clear rules for digital assets. They also said they would continue working with federal regulators while pursuing legislation.
The issue has become particularly important as the SEC and CFTC have started taking additional steps to clarify how existing U.S. financial laws apply to cryptocurrency.
SEC and CFTC Are Already Taking Action
The SEC and CFTC have not remained inactive while Congress debates broader legislation.
In March 2026, the two agencies issued a joint interpretation addressing how federal securities laws apply to different types of crypto assets and transactions. The guidance introduced distinctions involving digital commodities, digital collectibles, digital tools, stablecoins and digital securities.
The SEC has also proposed a tailored regulatory framework for certain investment contracts involving crypto assets. The proposal includes exemptions for some offerings and a conditional safe harbor related to the definition of an investment contract.
These actions could provide businesses and investors with greater guidance in the short term, but lawmakers such as Hill argue that agency rules cannot provide the same long-term certainty as legislation passed by Congress.
CFTC Moves Forward With New Crypto Rules
The CFTC has also moved ahead with its own regulatory proposals.
On October 5, CFTC Chairman Michael Selig announced a proposed framework for crypto exchanges offering leveraged or margined digital-asset trading. The proposal would create a new category of CFTC-regulated trading venues known as “crypto asset markets.”
Platforms operating under the proposed framework would face requirements related to areas such as market-manipulation controls and proof of reserves. The framework would also allow certain federally regulated platforms to offer leveraged or margined trading under CFTC oversight.
Selig has also acknowledged that agency action cannot permanently substitute for a statutory framework enacted by Congress.
Why the CLARITY Act Matters
The CLARITY Act was designed to create a broader market-structure framework for digital assets in the United States.
Among the issues addressed by the legislation are the regulatory responsibilities of the SEC and CFTC and the treatment of different categories of digital assets.
The legislation failed to advance in the Senate on September 15, creating another setback for efforts to establish comprehensive federal crypto market rules.
The failure has increased attention on the SEC and CFTC because regulators are now being asked to provide additional clarity using authorities they already possess.
Why Legislation Is Important for the Crypto Industry
A major issue is the difference between regulatory guidance and statutory law.
Regulators can issue interpretations, rules and guidance within the authority granted to them by Congress. However, those actions can be changed by future administrations or challenged in court.
Legislation, by contrast, can establish a more durable framework defining which agency has jurisdiction over particular crypto markets and activities.
For crypto companies, clearer legislation could potentially reduce uncertainty around issues such as:
- Digital-asset classifications
- SEC and CFTC jurisdiction
- Cryptocurrency exchanges
- Digital-asset trading platforms
- Investor protections
- Market manipulation
- Custody and intermediaries
- Decentralized finance
- Token offerings
The exact impact would depend on the final legislation approved by Congress.
What Happens Next?
The debate over U.S. cryptocurrency regulation is likely to continue as lawmakers, regulators and the crypto industry consider the next steps following the Senate’s failure to advance the CLARITY Act.
In the meantime, the SEC and CFTC can continue using their existing authorities to develop rules and provide guidance.
The CFTC’s recent proposal demonstrates that regulators are already attempting to address some of the industry’s regulatory gaps. However, the longer-term structure of the U.S. crypto market remains dependent on congressional action.
Impact on Crypto Investors and Businesses
For cryptocurrency investors, regulatory clarity can affect how exchanges, tokens and other digital-asset products operate in the United States.
For businesses, clearer rules could make it easier to understand which regulator has jurisdiction over a particular activity and what compliance requirements may apply.
However, until Congress establishes a comprehensive statutory framework, uncertainty is likely to remain around some parts of the crypto market.
Final Thought
French Hill’s latest comments highlight a central issue in the U.S. crypto debate: SEC and CFTC rulemaking can address some immediate regulatory questions, but Congress ultimately has the authority to establish a lasting statutory framework.
With the CLARITY Act failing to advance in the Senate, the SEC and CFTC are continuing to use their existing powers to provide regulatory guidance and develop new rules. The future direction of U.S. crypto regulation will therefore depend on how regulators balance those immediate actions with continued efforts in Congress to create comprehensive legislation.
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