CFTC Sends Crypto Asset Rulemaking to White House After Clarity Act Stalls
The Commodity Futures Trading Commission has formally submitted two crypto market ruleset proposals to the White House for regulatory review, bypassing Congress after the Clarity Act failed a procedural Senate vote on Tuesday. The filings land at a pivotal moment: for the first time, a US derivatives regulator is actively constructing a crypto compliance regime on its own authority, and the implications for digital asset accounting and reporting are immediate.
What the CFTC Filed and Where It Goes Next
On Thursday 18 September 2026, the CFTC submitted two documents to the Office of Information and Regulatory Affairs (OIRA), a division of the Office of Management and Budget that reviews federal regulations before they can be published in the Federal Register. The two filings are titled "Regulation Crypto Asset Transactions" and "Regulation Crypto Asset Markets."
OIRA review is a standard step in the federal rulemaking process, but it is not a rubber stamp. The office scrutinises the economic analysis behind proposed rules and can require agencies to revise or withdraw them. Once OIRA clears a filing, the agency can proceed to publish a notice of proposed rulemaking, open a public comment period, and eventually finalise the rule. That full cycle typically runs several months to over a year, so the CFTC's filing should be read as a starting gun, not a finish line.
Why Two Separate Filings
The distinction between the two filings matters for practitioners. "Regulation Crypto Asset Transactions" appears to address the conduct rules around individual crypto trades, such as leverage disclosures, margin requirements, and anti-fraud provisions. "Regulation Crypto Asset Markets" targets the market structure layer: who can operate as a venue, under what designation, and subject to which oversight framework. Separating them gives the agency flexibility to advance one strand even if the other encounters legal or political resistance.
The Clarity Act Collapse and Why the CFTC Is Acting Alone
The Clarity Act was designed to settle, once and for all, how digital assets are divided between SEC and CFTC jurisdiction. It failed a procedural vote in the Senate on Tuesday 16 September 2026. Key Democratic negotiators cited ethics concerns, specifically around the President's substantial crypto holdings tied to a family-linked venture and a memecoin, as their central objection. With the legislative route blocked, both agencies signalled they would press ahead under existing statutory authority.
CFTC Chair Selig had already telegraphed this approach. In an August speech, he directed staff to explore how developers offering protocols might be treated, and he outlined the concept of a new venue category, a designated contract market for crypto assets, that would allow both current registrants and non-registrant crypto exchanges to offer leveraged or margined crypto trading under purpose-built CFTC rules. The OIRA filings are the direct operational follow-through on that commitment. For context on how this fits the broader post-Clarity Act landscape, see our earlier analysis of SEC and CFTC rulemaking after the Clarity Act failure.
The CFTC's Existing Authority and Its Limits
The CFTC has long-established jurisdiction over commodity derivatives, and Bitcoin has been treated as a commodity since at least the agency's 2015 order in the Coinflip matter. Ether's commodity status has been asserted by the agency in multiple enforcement actions. Acting under existing authority means the CFTC can reach spot crypto markets only when fraud or manipulation is alleged; comprehensive spot market oversight has required congressional action. Chair Selig's approach appears to thread that needle by focusing on leveraged and margined trading, a domain the CFTC can regulate more firmly without new legislation, while framing broader market rules carefully enough to survive legal scrutiny.
The New Crypto Asset Market Designation Explained
The concept Chair Selig described in August is worth unpacking carefully. Under the proposal's framing, the CFTC would recognise a new subcategory of designated contract market (DCM) specifically for crypto assets. A standard DCM is a CFTC-regulated exchange authorised to offer futures and options; the new crypto asset market designation would extend that model to include spot-plus-leverage crypto trading on a platform that meets CFTC-set standards.
Who Could Qualify and What It Means for Venues
The framing explicitly contemplates two groups: existing CFTC registrants who could expand into crypto asset markets, and non-registrant crypto exchanges that could seek the new designation. For exchanges currently operating in a regulatory grey zone, this is a potential path to legitimacy, but it comes with full CFTC oversight: surveillance obligations, position limits, reporting requirements, customer protection rules, and likely capital and segregation standards.
For accounting firms advising exchange clients or for CFOs at firms that custody or trade on these platforms, the creation of a new registration category has direct financial reporting consequences. A newly designated crypto asset market would carry regulatory capital requirements that need to appear on the balance sheet. Segregated customer funds would require specific disclosure. Ongoing reporting obligations would generate data flows that need to be captured in whatever crypto compliance reporting infrastructure the firm maintains.
Accounting and Reporting Implications for Firms
The CFTC's move toward formalised crypto market regulation creates several near-term action points for finance teams and their advisers. These are not speculative; they follow directly from how CFTC registration and DCM oversight work today.
Regulatory Capital and Balance Sheet Treatment
Any exchange seeking the new crypto asset market designation will face capital adequacy requirements analogous to those applied to existing DCMs. For firms that are exchange operators or that hold equity stakes in exchange businesses, this affects how those investments are valued and disclosed. Auditors should be asking now whether their exchange clients have modelled the capitalisation impact of seeking this designation.
Segregation and Custody Disclosures
CFTC-regulated entities must segregate customer funds and report their segregation status. If crypto asset markets follow the futures model, exchange clients will need to demonstrate daily that customer assets are held separately from proprietary assets. For firms using crypto bookkeeping software, this means the software must be capable of tracking customer-vs-proprietary asset pools at a granular level and producing the reconciliation reports that a CFTC examination would require.
Transaction Reporting and Audit Trails
CFTC-regulated venues file detailed transaction reports. Bringing crypto asset markets under this umbrella would significantly expand the volume and specificity of data that exchanges must retain and submit. Digital asset accounting software that was built only for internal ledgering will need to be assessed against these external reporting requirements. Firms advising exchange clients should conduct a gap analysis between their client's current data architecture and what CFTC reporting standards would demand.
The No-Action Position for Software Developers
On the same day the CFTC filed with OIRA, it also issued a no-action position stating it would not recommend enforcement action against software developers who fail to register as introducing brokers, provided certain conditions are met. This is directly relevant to teams evaluating their crypto accounting software stack. For a detailed breakdown of those conditions, see our coverage of the CFTC no-action position for software developers.
The Political Risk Dimension
The Clarity Act's failure was not purely substantive. The ethics objections raised by Democratic senators reflect a broader political tension: an administration with direct financial interests in crypto outcomes is simultaneously writing the rules that govern crypto markets. That tension is unlikely to dissolve before the next legislative window, which means the CFTC's unilateral rulemaking path faces both legal challenge risk and political scrutiny.
Legal challenges to agency rulemaking under existing authority, particularly after the Supreme Court's 2024 Loper Bright decision curtailing Chevron deference, have become more common and more successful. Any final CFTC crypto asset market rule could face litigation arguing the agency has exceeded its statutory mandate. Firms and their advisers should treat the current rulemaking trajectory as the most probable near-term outcome while maintaining scenario plans for court-ordered delays or remand.
What Firms Should Do Before the Comment Period Opens
The OIRA review phase is the right time to prepare, before a notice of proposed rulemaking is published and the formal comment window starts. Finance teams, compliance officers, and their accounting advisers should be taking several concrete steps now.
Map Current Exposure to CFTC-Regulated Instruments
Identify every client or business line that trades leveraged or margined crypto, holds positions on platforms that may seek the new DCM designation, or operates as a software provider touching these workflows. This mapping exercise will determine which entities face the highest regulatory lift and which need the most urgent attention from a crypto bookkeeping software and reporting standpoint.
Assess Software and Data Readiness
CFTC reporting standards are more granular than most internal accounting needs. Run a gap analysis on your current digital asset accounting software: can it produce position-level transaction records, segregation reconciliations, and customer asset reports in the formats a CFTC exam would require? If not, now is the time to identify and close those gaps, not after a final rule is published.
Engage in the Comment Process
When the notice of proposed rulemaking is published, the comment period is a genuine opportunity to shape the final rule. Accounting and audit firms have specialist knowledge about what data is operationally producible and at what cost. Comments grounded in practical accounting and reporting feasibility carry weight at OIRA and in agency deliberations. Start drafting your substantive positions now, based on what the filings signal about scope.
Frequently Asked Questions
What is OIRA and why does it matter here?
OIRA, the Office of Information and Regulatory Affairs, sits within the Office of Management and Budget and reviews significant federal regulations before they can be published. It assesses the economic analysis behind proposed rules and can require revisions. The CFTC filing with OIRA is a required step before the agency can publish a formal notice of proposed rulemaking.
Does the CFTC currently have authority to regulate spot crypto markets?
The CFTC's direct regulatory authority over spot commodity markets is limited. It can act against fraud and manipulation in spot crypto markets, but comprehensive spot market oversight has historically required congressional legislation. The CFTC's strategy here appears to focus on leveraged and margined crypto trading, where its authority is stronger, while building toward a broader market structure framework.
What is a designated contract market and how might a crypto version differ?
A designated contract market is a CFTC-approved exchange authorised to list futures and options contracts. A crypto asset market designation, as described by Chair Selig, would adapt that model to allow spot-plus-leverage crypto trading under CFTC oversight, with purpose-built rules rather than a direct transplant of futures exchange requirements.
How does the CFTC's no-action position for software developers affect accounting firms?
The no-action position means software developers meeting certain conditions will not be recommended for enforcement action for failing to register as introducing brokers. For accounting firms evaluating their crypto accounting software providers, this provides short-term clarity on the regulatory exposure of those providers, but the conditions attached to the relief still need to be reviewed to confirm a given tool qualifies.
When will a final CFTC crypto rule be in place?
There is no definitive timeline. After OIRA review, the CFTC would publish a notice of proposed rulemaking, open a comment period, review comments, and publish a final rule. That process typically takes many months to well over a year. Legal challenges could extend it further. Firms should plan for a phased implementation window beginning in late 2027 at the earliest, while monitoring for accelerated timelines.
Source: The Block