U.S. senators have introduced a new bipartisan draft bill that could reshape the regulatory landscape for cryptocurrencies by giving primary oversight to the Commodity Futures Trading Commission (CFTC). Proposed by Senators John Boozman and Cory Booker, the bill aims to shift authority away from the Securities and Exchange Commission (SEC) and grant the CFTC the power to regulate most digital assets, classifying them as digital commodities.

This change reflects mounting industry pressure and a growing consensus that the SEC’s enforcement-heavy approach may have hindered innovation within the crypto sector. The new legislation is designed to provide clearer guidance for market structure, require certain crypto firms to register with the CFTC, and impose disclosure and transaction fee requirements. By formally recognizing digital assets like Bitcoin and Ethereum as commodities, the bill would place them firmly within the CFTC’s jurisdiction, while still reserving the SEC’s authority for assets defined as securities.

The proposal builds on recent efforts in the House, including the CLARITY Act, to divide digital assets into categories and clarify the roles of federal regulators. It also addresses longstanding regulatory confusion and aims to establish a unified framework for digital asset oversight, giving businesses more legal certainty and supporting further innovation in the industry.

While the measure has been welcomed by many in the crypto community, who see the CFTC as more industry-friendly, it faces a challenging legislative path. The bill must pass both the Senate Agriculture and Banking Committees and gain sufficient bipartisan support to move forward. Questions remain about how the CFTC will handle complex issues like decentralized finance (DeFi), as well as concerns around adequate funding and resources for the agency to effectively regulate a rapidly growing market.

If enacted, this bill would mark a significant shift in U.S. digital asset regulation, potentially setting new standards for consumer protection and market stability while aiming to make the U.S. a leader in responsible crypto innovation.

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