Following the failed CLARITY vote in the Senate, the SEC and CFTC introduced new crypto market regulations. The SEC implemented a five-year exemption for issuing and trading stock tokens, while the CFTC proposed a new registration category for crypto asset markets and plans to permit leveraged trading for registered exchanges.
The SEC also issued guidance clarifying that token buybacks do not automatically classify crypto tokens as securities and confirmed that liquid staking tokens are not securities. Additionally, the agency proposed new rules regarding the custody of crypto assets, while the CFTC moved to exempt certain crypto software providers from registration requirements.
Legal experts note that agency rules are susceptible to being rescinded or challenged in court. The 2024 Supreme Court decision in the Loper Bright case, which overruled the Chevron precedent, allows courts to more easily overturn agency regulations if they are found to be burdensome or lacking sufficient research.
While agencies have the authority to create rules under the Exchange Act of 1934, they must follow transparent logic and provide economic justification for their decisions. Regulatory guidance, such as FAQs, does not carry the same legal weight as formal legislation and can be modified by agency staff at any time.
