SEC and CFTC Pro-Crypto Rules: How Durable Are They?
After the CLARITY Act failed its Senate cloture vote, the SEC and CFTC moved fast to fill the vacuum with agency-level crypto rules. The SEC unveiled a five-year exemption permitting the issuance and trading of stock tokens, clarified that token buybacks do not automatically convert a commodity token into a security, stated that liquid staking tokens fall outside securities law, and proposed new crypto-asset custody rules. The CFTC, for its part, exempted certain crypto software providers from registration, proposed a new market category, and signalled its intent to allow registered exchanges to offer leveraged crypto trading. For accounting firms, CFOs, and auditors working with digital-asset clients, the central question is not whether these rules exist today but whether they will still exist tomorrow. The answer, based on legal analysis from D&A Partners attorney Yuriy Brisov speaking to Cointelegraph Magazine, is nuanced and heavily fact-dependent. Here is what professionals need to understand right now.
Where Agency Rulemaking Authority Actually Comes From
A common misconception is that the SEC oversteps when it creates rules rather than waiting for Congress. In reality, the SEC has held rulemaking authority since its founding under the Exchange Act of 1934, itself a response to the US market collapse of the late 1920s. Congress deliberately created a regulatory architecture that sets broad statutory frames and delegates the technical detail to specialist agencies, precisely so that the system could adapt to new technology without requiring fresh legislation every decade.
The Gensler Precedent and the Current Opening
Under the previous administration, the SEC attempted to bring crypto tokens within the existing securities framework, largely through enforcement rather than clear prospective rules. That approach produced litigation, regulatory uncertainty, and a well-documented exodus of crypto businesses from the US market. The current Commission's position, as described by Brisov, is that the failure of the enforcement-first approach creates a legitimate legal foundation for the new interpretation: "You tried, but we can see that it's not working. So we'll offer our own rules." That reasoning matters because reversibility works in both directions. A future administration seeking to unwind the current rules would need to demonstrate, with the same rigour, that those rules themselves had failed.
The Loper Bright Shift and What It Means for Crypto Rules
For four decades, the 1984 Chevron doctrine required courts to defer to an agency's interpretation of ambiguous statutes. If the law was unclear, the agency's reading prevailed. The Supreme Court's June 2024 decision in Loper Bright Enterprises v. Raimondo overruled Chevron entirely. Courts must now apply their own independent legal analysis rather than defaulting to agency expertise.
Practical Effect on SEC and CFTC Rules
The post-Loper Bright landscape cuts in two directions simultaneously. On one hand, it makes it harder for a future hostile administration to simply reinterpret rules in the opposite direction and expect courts to defer to that new reading. On the other hand, it also makes current rules more vulnerable to challenge by any party that can demonstrate economic harm and inadequate research. As Brisov puts it, a challenger must prove "that there was not enough research and that it's burdensome for the business, and it's not profitable for the US market." That is a real threshold, and it is exactly the kind of cost-benefit analysis that accounting and financial professionals can document.
There is already a live test case in the courts. A community bank group is suing the Office of the Comptroller of the Currency, arguing that the OCC exceeded its statutory authority by granting national trust bank charters to crypto firms. That litigation will generate precedent directly relevant to how courts evaluate agency jurisdiction in the digital-asset space, and its outcome deserves close monitoring by any firm with US crypto exposure.
How Easily Can a Future Administration Roll Back These Rules?
TD Cowen has publicly cautioned that agency rules "are the easiest to rescind," and history bears that out: Trump-appointed commissioners dismantled the Gensler-era framework with relative speed. However, the legal analysis suggests that the current rules may be more durable than their predecessors, for two connected reasons.
The Economic Entrenchment Argument
Brisov's analysis centres on what happens when significant private capital is deployed in reliance on a regulatory framework. If businesses invest heavily in tokenised-stock infrastructure, custody systems, or leveraged-trading operations built on the current SEC and CFTC rules, a successor commission cannot simply declare the rules void. It would have to work through a structured analytical process, articulating the specific problem, the applicable legal rule, a thorough economic analysis, and a reasoned conclusion. "They have to bring up an economic background for it. They have to bring up research, and they have to prove that it's insufficient." The more capital that accumulates under the existing framework, the higher that analytical bar becomes.
The Howey Test Anchor
Even the most ambitious interpretation of the current SEC's deregulatory intent has limits. Chair Paul Atkins has repeatedly and publicly reaffirmed that the Howey test remains valid US law. The Commission's approach is to apply Howey differently to specific fact patterns, not to abandon the test. That consistency matters for legal durability: it means the current rules are framed as interpretations within an established legal framework, not as departures from it, which makes them harder to characterise as ultra vires in court.
What "Guidance" Actually Is, and What It Is Not
One of the most practically important points from the Brisov interview concerns the legal weight of SEC staff guidance, including FAQs. When the SEC published an FAQ stating that a crypto project's token buybacks do not transform a commodity token into a security, some market participants treated it as a green light with the same standing as a formal rule. It is not.
FAQs, Staff Notes, and the Limits of Reliance
Brisov is direct on this: an FAQ "doesn't have any authority, even for the staff." It is, in his analogy, the equivalent of a university casebook rather than the statute itself. The SEC revised the token-buyback FAQ within a week of publication after legal counsel from a prominent venture capital firm identified what it described as a significant loophole. That revision was entirely routine from a legal standpoint: staff notes can be rewritten at any time, without notice-and-comment rulemaking, and without any of the procedural protections that attach to formal rules. The implication for compliance teams is clear: structuring a material transaction, a token buyback programme, a staking product, or a custody arrangement, around an FAQ rather than a formal rule or no-action letter creates a category of regulatory risk that needs to be explicitly identified and managed.
Accounting and Audit Implications for US-Facing Firms
The legal durability question translates directly into financial reporting and audit risk. If the regulatory basis for a client's business model is agency rulemaking rather than statute, that is a going-concern and contingent-liability consideration that auditors cannot ignore.
For Accounting Firms and Auditors
Firms auditing entities that hold tokenised stocks under the SEC's five-year exemption, operate as crypto software providers relying on the CFTC's registration carve-out, or offer leveraged crypto products under the proposed CFTC framework need to document the specific regulatory basis for each activity in the audit file. The distinction between a formal rule, a proposed rule, a staff FAQ, and a no-action letter is material to the assessment of regulatory risk. Post-Loper Bright, that risk assessment must also include an evaluation of how well the underlying rulemaking process would withstand judicial scrutiny, specifically whether the agency conducted adequate economic analysis and stakeholder consultation. There is some evidence that the current commissions have done this: Brisov notes that "Paul Atkins and the SEC have been consulting with many crypto firms, with VCs. They've been doing their research." But the documentation of that consultation will matter if the rules are challenged, and auditors should consider whether their clients have retained their own records of reliance on the regulatory process.
For CFOs and Finance Teams
Any entity that has committed capital to infrastructure built on the current crypto rules, custody systems, tokenised-equity trading platforms, staking operations, needs a regulatory-risk section in its treasury and risk management framework. That section should map each activity to its specific regulatory basis, distinguish between binding rules and interpretive guidance, and include a scenario analysis of what a rule reversal would mean for the balance sheet. Under ASC 450 (contingencies) or its IFRS equivalent IAS 37, the probability and potential financial impact of rule reversal may need to be assessed and, where material, disclosed. Crypto accounting software used to track these positions should be configured to capture the regulatory status of each instrument, not just its market value, so that a change in classification can be modelled quickly.
The broader market-structure picture is moving on multiple fronts simultaneously. Firms tracking US developments alongside European regulatory shifts may find our coverage of the EU DLT Pilot Regime cap increase and the CFTC framework's 2028 election deadline risk useful context for multi-jurisdictional planning.
Frequently Asked Questions
Does the SEC have the legal authority to create crypto rules without Congress passing legislation?
Yes. The SEC's rulemaking authority derives from the Exchange Act of 1934 and has existed since the agency was founded. Congress deliberately built a framework of broad statutory principles that agencies fill in with specific rules, so that the system can adapt to new technology. The current SEC's pro-crypto rules sit within that established authority, provided they meet procedural and economic-analysis requirements.
What did the Loper Bright decision change for crypto regulation?
Loper Bright, decided by the Supreme Court in June 2024, overruled the 1984 Chevron doctrine. Courts no longer defer automatically to an agency's interpretation of an ambiguous statute. They must apply their own legal analysis. This makes both the current pro-crypto rules and any future attempt to reverse them more vulnerable to court challenge, because neither a supporting nor an opposing administration can rely on automatic judicial deference.
Can a future, less crypto-friendly SEC simply reverse the current rules?
Not without a structured, evidence-based rulemaking process. Any successor commission would need to articulate the specific problem with the existing rules, conduct adequate economic research, and demonstrate that reversal serves the public interest. The more private capital that has been deployed in reliance on the current framework, the higher that analytical and procedural bar becomes. A reversal that ignores economic reliance would be legally vulnerable.
What legal weight does an SEC FAQ carry?
Very little. An FAQ is staff guidance, not a formal rule. It carries no binding authority, even over SEC staff themselves, and can be revised or withdrawn without notice-and-comment rulemaking. The SEC's token-buyback FAQ was revised within a week of publication. Firms should not structure material transactions on the basis of FAQ guidance alone without formal legal advice and, where possible, a no-action letter or explicit rule citation.
How should auditors document regulatory risk under these agency rules?
The audit file should identify the specific regulatory instrument underpinning each client activity (formal rule, proposed rule, staff guidance, or no-action letter), assess the procedural adequacy of the underlying rulemaking, and evaluate the probability of reversal or court challenge. Where the regulatory basis is guidance rather than a formal rule, that distinction should be reflected in the risk assessment and, where material, in disclosures prepared in accordance with ASC 450 or IAS 37.
Source: Cointelegraph Magazine