By Gena Dirani
Recent developments from the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), and Congress reflect a coordinated shift in U.S. crypto regulation toward a more defined market structure framework. Rather than relying primarily on enforcement actions or fragmented guidance, regulators are moving toward clearer articulation of how existing regulatory regimes are applied to digital assets, particularly in ways that will affect classification and compliance approaches used by SEC-registered advisers.
A Functional Token Taxonomy Reframes the Core Legal Question
The SEC’s March 2026 press release and accompanying interpretive approach introduce a more structured way of analyzing digital assets, distinguishing among categories such as digital securities, digital commodities, digital collectibles, digital tools, and payment stablecoins. Under this framework, only “digital securities” remain fully within SEC jurisdiction, while other token types may fall outside securities laws unless offered or sold as part of an investment contract.¹ Importantly, classification is not static, and a digital asset may be subject to securities laws at issuance or in connection with particular transactions even if it does not constitute a security on a standalone basis.
Chairman Paul Atkins emphasized that this approach is intended to reduce long-standing uncertainty over how securities laws apply to crypto assets, particularly where token networks evolve over time. He highlighted that the analysis of whether an investment contract exists remains grounded in established precedent and emphasizes that the analysis may depend on how crypto networks function over time, including post-issuance developments affecting decentralization and investor expectation. ²
This reflects a shift toward a more lifecycle-sensitive application of existing securities law principles, rather than a purely issuance-based analysis.
From a compliance perspective, this increases the importance of advisers maintaining a documented, repeatable process for token classification, particularly where assets may evolve in form, function, or decentralization over time.
SEC–CFTC Coordination: Jurisdictional Alignment Through Process, Not Substantive Rulemaking
A memorandum of understanding (MOU) between the SEC and CFTC sets out a framework for interagency coordination, including consultation, information sharing, and cooperation on matters involving digital asset markets. ³
Importantly, the MOU does not itself establish a joint taxonomy or redefine statutory jurisdiction. Instead, it reflects a procedural commitment by the agencies to coordinate where their respective regulatory regimes may overlap, particularly in areas involving trading platforms, intermediaries, and products that may implicate both securities and commodities laws.
In practice, this coordination is intended to reduce regulatory friction and improve consistency in enforcement and supervisory approaches, without altering the underlying statutory frameworks, though it signals an intent to improve coordination in how those frameworks are applied in overlapping jurisdictions.
For advisers, the significance lies less in new legal categories and more in the expectation that regulatory interpretations across agencies will be increasingly aligned in application, particularly in examination and enforcement contexts involving asset classification and trading activity.
From Enforcement to Framework: A Structural Shift in SEC Approach
The SEC’s recent guidance provides more structured interpretive direction for applying the Howey framework to crypto assets, while continuing to operate within existing securities law principles. While still grounded in established securities law principles, the analysis increasingly considers factors such as network maturity, decentralization, and functional use of tokens.
The result is a more structured analytical approach for determining when crypto-related transactions implicate securities laws, particularly in evolving blockchain ecosystems.
For advisers, this shift increases the importance of maintaining policies that are not only defensible at the point of asset onboarding, but also adaptable to changes in underlying facts and circumstances over time.
Congressional Context: CLARITY Act and GENIUS Act
These regulatory developments are occurring alongside congressional efforts to formalize digital asset market structure.
The CLARITY Act remains a pending legislative proposal intended to define jurisdictional boundaries between the SEC and CFTC and establish statutory definitions for categories of digital assets. Its structure broadly reflects many of the conceptual distinctions appearing in recent regulatory guidance, signaling potential convergence between legislative and regulatory approaches.
The GENIUS Act, by contrast, has already been enacted and establishes a federal framework for payment stablecoins. It excludes permitted stablecoins from treatment as securities, reinforcing the separation between payment instruments and securities regulation in certain contexts.
Together, these bills reflect an ongoing effort to translate regulatory interpretations into statutory law governing digital asset markets.
The Emerging Integrated Framework
Taken together, the SEC’s guidance, the SEC–CFTC coordination agreement, and congressional activity point to an increasingly structured and coordinated approach to digital asset regulation:
• SEC: digital securities and investment contracts
• CFTC: digital asset derivatives and commodity markets under existing authority
• Congress: statutory market structure (CLARITY Act) and stablecoin regime (GENIUS Act)
This reflects a gradual move toward a more coherent allocation of oversight responsibilities across agencies and legislative proposals, rather than a fully unified regulatory code.
From an adviser standpoint, the practical effect is increased convergence in expectations around classification discipline, documentation, and consistency across advisory, trading, and disclosure functions.
The SEC’s March 2026 guidance represents a meaningful step toward greater clarity in how federal securities laws apply to digital assets. When viewed alongside the SEC–CFTC coordination framework and ongoing congressional activity, the direction is toward a more structured and predictable regulatory environment for crypto markets – one that increasingly emphasizes consistent classification and governance practices for SEC-registered advisers.
Footnotes
- SEC, Press Release No. 2026-30, “SEC Clarifies Application of Federal Securities Laws to Crypto Assets” (Mar. 2026), https://www.sec.gov/newsroom/press-releases/2026-30-sec-clarifies-application-federal-securities-laws-crypto-assets
- SEC Chairman Paul S. Atkins, “Remarks on Regulation of Crypto Assets” (Mar. 2026), https://www.sec.gov/newsroom/speeches-statements/atkins-remarks-regulation-crypto-assets-031726
- SEC–CFTC Memorandum of Understanding on Cooperation and Information Sharing Regarding Digital Asset Markets (2026), https://www.sec.gov/files/mou-sec-cftc-2026.pdf