SEC and CFTC proposed new rules for the crypto industry

CFTC has launched an initiative to legalize spot trading of cryptocurrencies on registered exchanges. In turn, SEC has updated its guidance on the accounting rules for stablecoins.

CFTC Steps

This refers to contracts that track the spot price of cryptocurrencies but are traded on registered derivatives markets (DCM). Acting Chair of the CFTC, Caroline Pham, called this a straightforward way to establish federal regulation of the spot trading of digital assets.

The Commission has opened a public comment period on an initiative aimed at clarifying the application of Section 2(c)(2)(D) of the Commodity Exchange Act. This provision pertains to retail transactions using leverage or margin. The Commission is also gathering opinions on Part 40 of its rules, which govern the activities of DCM.

CFTC is also interested in the potential implications for securities laws. For example, how SEC regulation might apply to the trading of assets that are investment contracts.

Proposals are accepted until August 18.

The initiative is part of a program to implement the recommendations of the Working Group on Digital Asset Markets, established under the administration of Donald Trump. Among them is a clearer definition of cryptocurrencies as commodities and the development of rules for participants in the DeFi market.

SEC Rules

The new guidelines allow for the classification of "stablecoins" pegged to the US dollar as equivalent to cash. For this, stablecoins must have a guaranteed redemption mechanism and a stable value backed by another class of assets.

The initiative is part of SEC Chairman Paul Atkins' efforts to simplify regulation. Last week he introduced Project Crypto. Its goal is to modernize the rules for securities and ensure the transition of US financial markets to blockchain.

Analysts at Bernstein called the initiative "revolutionary". In their opinion, it could turn the USA into a global center for blockchain finance.

Fight Against Debanking

Trump plans to sign an order requiring regulators to investigate cases of debanking cryptocurrency companies, according to the WSJ citing a draft of the document.

The decree will require regulators to check whether financial institutions have complied with the laws on good faith lending, consumer protection, and antitrust rules. If violations are identified, they may face fines or lawsuits.

Regulators will also need to revoke their own rules that may have contributed to banks refusing to serve certain clients. Potential violations may be referred to the Department of Justice for further action.

Representatives of the crypto industry have long claimed that the Joe Biden administration pressured banks through regulators to sever the sector from the financial system. This phenomenon has been dubbed Operation Choke Point 2.0.

The decree will also address the alleged cases of denial of service for political reasons, particularly concerning conservatives.

According to WSJ, Trump may sign the document this week, however, the White House's plans may change.

Recall that in July, the president signed the GENIUS Act bill, which establishes rules for stablecoins and is the first significant regulatory act for the crypto industry in the country.