CFTC Updates Tokenized Asset and Blockchain Recordkeeping Guidance After Senate Blocks CLARITY Act
Key Takeaways
- •The CFTC revised its FAQ guidance to allow registered crypto-related entities to invest customer funds in tokenized assets and to use blockchain-based recordkeeping.
- •Tokenized investments are permitted only when the token grants holders legal and economic rights that are the same or functionally equivalent to those of the traditional asset.
- •The updated guidance, originally issued in March, was announced days after the US Senate failed to advance the Digital Asset Market Clarity (CLARITY) Act.
- •With crypto market structure legislation not expected to pass before 2027, the CFTC has submitted a crypto market regulation plan for White House review.
- •SEC Chair Paul Atkins said the agency is ready to propose crypto rules without congressional action, following its August proposal on certain investment contracts involving crypto assets.
The US Commodity Futures Trading Commission (CFTC) has updated its guidance on tokenized assets and the use of blockchain technology for recordkeeping, days after the US Senate failed to advance a major digital asset market structure bill.
In a Thursday notice (Press Release 9303-26), the regulator said it had revised information in its frequently asked questions concerning registered crypto-related entities.
The guidance, originally released in March, was updated to specify that authorized companies may invest customer funds in tokenized forms of assets, provided “the tokenized form of the asset grants the holder legal and economic rights that are the same or functionally equivalent to the rights received by holders of the asset in its traditional form.” The regulator added that it “would not object” to companies using blockchain-based recordkeeping under the new rules. For registered crypto-related entities, the revisions set out explicit conditions for holding customer funds in tokenized form and for keeping records on a blockchain.
CFTC Chair Michael Selig said the changes are part of efforts “to provide regulatory clarity for the crypto industry.”
The move came days after the US Senate failed to advance the Digital Asset Market Clarity (CLARITY) Act, a bill expected to clarify the respective roles of the CFTC and the Securities and Exchange Commission (SEC) in overseeing digital assets. The CFTC oversees US commodities and derivatives markets, while the SEC regulates securities — a split of jurisdiction whose application to digital assets has been a recurring source of regulatory uncertainty.
Following the failed cloture vote, many expect that Congress will be unable to pass crypto market structure legislation before 2027, prompting regulators to advance their own policies through rulemaking. The CFTC has already submitted a crypto market regulation plan for review by the White House.
Echoing the commodities regulator, SEC Chair Paul Atkins said before the CLARITY vote that the agency was “ready, willing, and able” to propose rules on crypto in the absence of congressional action. The SEC proposed rules on “certain investment contracts involving crypto assets” in August.
Source: Cointelegraph
