The US Commodity Futures Trading Commission (CFTC) is laying the groundwork for what its chairman calls “mass tokenization,” moving forward with crypto rules under existing authority after the Senate failed to advance the CLARITY Act, the market structure bill that would set jurisdictional lines for digital asset oversight.

Speaking Tuesday at the US Treasury Market Conference, CFTC Chair Michael Selig said regulators are adapting existing frameworks for blockchain technology, artificial intelligence, and onchain markets. He argued that tokenization of real-world assets (RWAs) could become the foundation of a more efficient financial system, enabling near-instant settlement and real-time collateral movement between clearinghouses, intermediaries, and users. In practice, tokenization means representing traditional assets — such as Treasuries, funds, or equities — as digital tokens on blockchains.

“Just as the transition from hand signals to electronic trading advanced our financial system, I believe tokenization can do the same for all asset classes,” Selig said in remarks published on the CFTC’s website. He added that the agency would pursue principles-based rules as tokenization and onchain finance evolve.

Selig said in August that the CFTC would proceed with crypto rules under its existing authority if Congress did not pass the CLARITY Act. The Senate failed to advance the bill on Sept. 15, leaving market structure questions to be worked out through agency rulemaking in the meantime.

On Sept. 17, the CFTC submitted a regulatory action covering crypto asset transactions and markets for White House review. The filing remains at the “prerule” stage and does not detail the planned regulations. Prerule is the earliest phase of the federal rulemaking process, in which an agency frames a topic and gathers input before a formal proposal is published, so specific requirements would surface only in later stages.

SEC also moves to bring markets onchain

Officials at the US Securities and Exchange Commission (SEC) have likewise promoted the development of tokenized markets. In a Bloomberg TV interview, Jamie Selway, the SEC’s Division of Trading and Markets director, said tokenization and crypto have recently become politicized but are “not naturally a politicized function.” He added that US success in developing these markets should receive bipartisan support.

Also on Sept. 17, the SEC granted a temporary “Innovation Exemption” for tokenized US stock trading, announcing the move on X. The exemption allows certain platforms to trade digital versions of US-listed stocks under certain conditions, offering an early pathway for onchain equities while a permanent framework is still being developed.

SEC Chair Paul Atkins said in February that such an exemption could facilitate onchain trading while regulators developed longer-term rules. Because the exemption is temporary, its scope remains tied to how that rulemaking develops.