/>iAs expected, September started with what has been dubbed a “crypto sprint,” as various branches of government look to quickly put into place digital asset regulations and legislation before the end of the year. In the Senate, the Senate Banking Committee has released its updated market structure legislative draft — maintaining key differences from the House’s market structure bill — the CLARITY Act, which passed by an overwhelming bipartisan vote earlier this year. At the SEC, the agency is hard at work coordinating with the CFTC on multiple crypto-related issues, and it released its rulemaking agenda for the upcoming year.
Detailed breakdowns of these developments, their implications for businesses going forward, and a few other updates on crypto-law topics are discussed below.
Senate Releases Market Structure Draft Bill: September 5, 2025
Background: Before the August recess, the Senate Banking Committee released a discussion draft market structure bill with an accompanying request for comments. Polsinelli assisted with the Digital Chamber’s response to those comment requests. Back from break, the Senate has now taken in those comments and released an updated draft titled the Responsible Financial Innovation Act. Senate Banking Chair Tim Scott will try to advance this draft through committee this month to stay on the fast-paced schedule that congressional and executive branch leadership is aiming for. While still waiting for the Senate Agriculture Committee’s companion draft to address many CFTC-related issues, Senate Banking will need to schedule a hearing in the near future on this revised draft for any chance of passing in 2025.
Analysis: The big question was whether the Senate’s bill would revert to the CLARITY Act’s control-based/decentralization test (which passed the House in an overwhelming vote of 294-134) to determine if sales of certain digital assets would be considered securities transactions, versus the Senate’s bill, which created an “ancillary asset” concept to determine when a transaction involving digital assets constitutes a securities transaction. That question was answered, as the current draft maintains the ancillary asset framework with some fairly important changes. The biggest industry win in the revised draft has to be the increased protection for developers of noncustodial software tech, which was advocated for by more than 100 industry participants and spearheaded by the DeFi Education Fund. From an initial review, it appears that the draft implemented many of the modifications requested by industry comments — but at 182 pages, it is expected to have areas that still need improvement.
SEC and CFTC Release Joint Statements on Crypto Issues: September 2-5, 2025
Background: The SEC and CFTC released a joint statement clarifying the views of both agencies’ staff that “SEC- and CFTC- registered exchanges are not prohibited from facilitating the trading of certain spot commodity products.” One large hold-up in facilitating the sale of tokenized securities through existing digital asset exchanges (or facilitating the sale of non-securities crypto assets through alternative trading systems and securities exchanges) is how the exchanges would be permitted to sell, or accept as payments, non-securities like $USDC or $BTC alongside tokenized securities. This appears to be the first step in overcoming that hurdle. A few days later, CFTC Acting Chair Pham and SEC Chair Atkins released a joint statement with the subtitle, “Next Steps – Bringing Novel and Innovative Products Back to America,” which relates to planned convergences of securities and commodities laws that might facilitate the development of “everything exchanges.”
Analysis: While the statements don’t create any new actionable law, they do signal the direction in which the agencies will be heading. The follow-up statements on bringing novel financial products back onshore were also important. All the listed areas of focus — 24/7 markets, perps, event contracts, DeFi and portfolio composition requirements — directly implicate crypto or benefit from blockchain ledger technology rails, so it seems like good things are on the horizon. It also means the policy work done in the next 12-18 months could shape U.S. financial markets for decades to come.
SEC Releases Regulatory Agenda: September 4, 2025
Background: The SEC’s Office of Information and Regulatory Affairs released the Spring 2025 Unified Agenda of Regulatory and Deregulatory Actions, which Chair Atkins described as covering “rule proposals related to the offer and sale of crypto assets to help clarify the regulatory framework for crypto assets and provide greater certainty to the market,” as well as “withdrawal of a host of items from the last Administration that do not align with the goal that regulation should be smart, effective and appropriately tailored within the confines of our statutory authority.”
Analysis: While the market structure legislation efforts are ongoing in the Senate, the SEC has clearly signaled that it intends to move forward with crypto-related rulemaking efforts without waiting on the outcomes of those legislative efforts. The proposed rule changes include many areas that can be expected to impact crypto (such as revised definition of “Dealer” and Rule 144 Safe Harbor changes) and five agenda items that directly mention crypto:
(1) Crypto Assets;
(2) Amendments to the Custody Rules;
(3) Transfer Agents;
(4) Amendments to Broker-Dealer Financial Responsibility and Recordkeeping and Reporting Rules; and
(5) Crypto Market Structure Amendments.
There is very little detail at this point, but it is a step in the right direction and a forecast of what is to come in the next 6-12 months. It is also interesting that, for the first time, this is being framed as a deregulatory agenda — not just a regulatory one.
Briefly Noted:
NASDAQ Submits Crypto Rule Change Proposal: The NASDAQ Exchange has submitted a proposed rule to the SEC regarding the tokenization of stock for trading on-chain.While the current proposal doesn’t include T+0 settlement, trading stocks through blockchain ledger technology could allow for faster settlement and easier books and records-keeping compliance, alleviating the need for burdensome consolidated audit trail rules.
Fed Conference on Payments Innovation: The Federal Reserve is hosting a conference on “payments innovation.” Less than a year ago, we were in the throes of Operation ChokePoint 2.0, and now the Fed is actively bringing together crypto leaders to figure out how to integrate blockchain into the financial system.
Polymarket No-Action: Polymarket will be available to U.S. consumers after the CFTC issued a no-action letter that allows Polymarket to offer event contracts without reporting the data required under U.S. financial regulations (which wouldn’t have added much, given the level of transparency). This comes as prediction markets start to influence sports wagering markets with their rise in popularity.
Crypto Funding Stays Hot: Crypto companies have raised over $16 billion this year from venture, which is on pace to beat the funding record from 2021, when companies in the space raised over $29 billion. This comes as Figure and Gemini both are looking to go public in the near term and M&A in the space is hotter than ever.
100+ Industry Participants Push for Developer Protections: DeFi Education Fund organized a huge coalition of industry advocacy groups and participants to sign a letter advocating for protecting the software developers and non-custodial service providers. The Digital Chamber’s Consumer Innovation working group came up with draft legislative text for self-custodial wallet developers and consumers — which is a good start — and which was highlighted on pg. 30 of the Digital Chamber’s letter to the Senate Banking Committee on market structure legislation. As noted above, these efforts were seemingly successful in getting developer protections added to the Senate market structure bill efforts.
Why Stablecoins: Similar to the effort spearheaded by Polygon a few years ago of compiling real world uses cases for blockchain technologies, this recent effort to compile what makes stablecoins so useful is a nice addition to the zeitgeist.
Economic Data on the Blockchain: Commerce Secretary Lutnick went semi-viral recently when he said his department will start issuing economic data on blockchain (official release here). This will allow pricing oracles to rely on blockchain data versus publicized data, which can lag and have errors in reporting. This could have a large effect on how economic indicators get priced into the market.
White Hat Safe Harbors: In addition to the crypto privateer law proposals, more and more DeFi protocols are providing safe harbors to white-hat hackers in event of a breach or exploit. By the time authorities get involved, it is often too late, so giving private actors — who have the ability to stop these exploits while they are occurring — the power to do so is a good idea.
Conclusion:
The pace of developments underscores that the “crypto sprint” is more than just a slogan; lawmakers, regulators and industry participants are all moving quickly to shape the rules that will govern digital assets for years to come. With the Senate Banking Committee pressing forward on its market structure bill, the SEC and CFTC aligning on joint statements and rulemaking agendas and agencies across the government opening the door to blockchain-based innovation, the next several months will be decisive.
Whether the result is greater clarity, better protections for developers and consumers or a framework that helps keep innovation onshore, what happens in 2025 will set the trajectory for the U.S. digital asset ecosystem well into the next decade.
