CFTC updates guidance on tokenized assets, blockchain records after failed vote

The U.S. Commodity Futures Trading Commission updated its frequently asked questions for registered crypto-related entities to clarify how tokenized assets and blockchain-based records fit under its oversight. The revision specifies that authorized firms may invest customer funds in tokenized versions of assets as long as those tokens confer legal and economic rights that are the same as, or functionally equivalent to, the rights attached to the asset in traditional form. The CFTC also stated it would not object to firms using blockchain technology for recordkeeping under the updated guidance. CFTC Chair Michael Selig framed the changes as part of the agency’s effort to provide regulatory clarity for the crypto industry. The timing of the update follows the U.S. Senate’s failure to advance the Digital Asset Market Clarity (CLARITY) Act, a bill intended to delineate the respective roles of the CFTC and the Securities and Exchange Commission in regulating digital assets. With the CLARITY Act failing a cloture vote, observers cited in the source expect Congress is unlikely to pass comprehensive crypto market-structure legislation before 2027. In that environment, federal regulators have signaled they will proceed with their own rulemaking to address gaps. The CFTC has already submitted a crypto market regulation plan to the White House for review. The SEC has expressed a similar posture. SEC Chair Paul Atkins told lawmakers he was prepared to propose rules on crypto if Congress did not act, and the agency issued proposed rules in August addressing "certain investment contracts involving crypto assets." These developments suggest federal agencies are moving to tighten regulatory frameworks for digital assets in the absence of near-term congressional legislation.