JPMorgan analysts led by Nikolaos Panigirtzoglou warned that much of the U.S. crypto industry's recent regulatory progress rests on agency actions that could be unwound as early as 2028, according to a report published Wednesday and covered by The Block on October 22.

Why JPMorgan Sees a Two-Year Clock

The Senate failed to advance the Clarity Act, a market-structure bill, in September, and the bank expects the legislation will not pass this year, though it may return in 2027. Until then, the analysts said, the industry relies on a patchwork of agency actions that "could be overturned in as soon as two years" if a Democrat wins the White House. Unlike legislation, agency actions reflect the priorities of the sitting administration, which is what ties their durability to the electoral calendar.

The bank still credits those measures. Regulator-led actions can encourage institutional participation in the near term and partly offset the Clarity Act setback, the report said. Only legislation would make the framework durable, however, and until it passes, the analysts expect elevated political and legal risk premiums to persist in crypto.

Each measure rests on a different legal footing.

The SEC Exemption Runs Five Years, and Sentiment Has Shifted

The Securities and Exchange Commission (SEC) issued its Innovation Exemption on September 17, days after the Clarity Act stalled (order). The order grants temporary, conditional relief, set to run for five years: certain tokenized securities venues are exempted from the definition of an exchange, and certain liquidity providers from the definition of a dealer. Chairman Paul Atkins titled his statement on the order a bridge toward durable rulemaking and said the interim measure must be followed by permanent rules.

The order carries conditions, detailed in a fact sheet. Venues must restrict access to approved participants and face trading limits, synthetic tokens are excluded, and tokenized shares must carry the same rights as the underlying stock, including dividends and voting. Issuers can also object and block their shares from trading on these venues.

The analysts tied that opt-out to market sentiment. More companies have recently chosen it, they said, and sentiment toward application tokens such as ether weakened as ETF flows and futures positioning softened. Both measures had risen in the period right after the SEC's September announcement.

The CFTC Plan Is Unlikely to Move Before 2027

The Commodity Futures Trading Commission published an advance notice of proposed rulemaking on October 5, seeking input on a framework for retail crypto trading, including leveraged trading on regulated U.S. platforms, and possibly a purpose-built category of designated contract market. An advance notice is the earliest formal step in the federal rulemaking process, inviting public comment before any proposal is drafted. JPMorgan called the plan early-stage, and its expected timing would leave little room before the 2028 election.

The analysts still see value in it. Trading that moves onshore, they said, could deepen liquidity, improve price formation, and support regulated venues that institutions are more likely to use.

Stablecoin Charters Are Harder to Unwind

The Office of the Comptroller of the Currency (OCC) has granted national trust charters to a growing number of stablecoin issuers and digital asset firms, bringing custody, reserve management, and issuance under federal oversight. The Independent Community Bankers of America, a trade group representing community banks, has sued the OCC over parts of those approvals. the report's assessment, the charters are not immune from challenge, but once granted they tend to be difficult to unwind in practice.

A statute also sits beneath them. The OCC's October 21 final rule implements the GENIUS Act, the federal stablecoin statute, and both take effect on January 18, 2027, according to the agency. The rule covers reserves, redemption, and risk management, while anti-money-laundering and sanctions requirements will follow in separate rulemaking with the Treasury. Operating terms can still shift within that framework, as the debate over how the OCC will assess stablecoin rewards shows.

What Limits a Reversal, and What to Watch

A new administration could not simply erase these measures. Agencies changing course must follow required procedures, and federal law (5 U.S.C. 706) lets courts set aside agency actions that exceed statutory authority, skip required steps, or are arbitrary and capricious. That protection works in both directions: the same standard applies to the community banks' challenge to the OCC charters.

Key dates to watch:

• Nov. 19 — FASB (the Financial Accounting Standards Board) comment period closes on treating certain stablecoins as cash equivalents.
• Jan. 18, 2027 — GENIUS Act and OCC stablecoin rule take effect.
• 2027 — Clarity Act could return, with the CFTC framework possible at the earliest.
• Nov. 2028 — Presidential election, the earliest reversal point JPMorgan flags.

The nearest of those dates is FASB's. The analysts said adopting cash-equivalent treatment would support stablecoin use beyond crypto trading, in corporate payments and liquidity management.

This article is provided for informational purposes only and does not constitute legal, financial, or investment advice.