New Senate Draft Could Strip SEC of Authority Over Crypto Markets
A quiet but consequential power shift is brewing in the U.S. Senate that could redefine how America governs digital assets.
A new bipartisan proposal seeks to give the Commodity Futures Trading Commission (CFTC) primary control over the crypto industry — sidelining the Securities and Exchange Commission (SEC), which has long dominated the sector’s enforcement.
A New Direction for Crypto Regulation
The proposal, championed by Senators John Boozman and Cory Booker, positions the CFTC as the main regulator for what would now be labeled “digital commodities.” In practice, this would mean that most cryptocurrencies — including Bitcoin and Ethereum — would be overseen by the commodities agency, not the SEC.
The shift has reportedly gained momentum within the Trump administration, which views the CFTC as a more predictable and industry-friendly watchdog. But the timing is sensitive: the crypto market has seen its total valuation shrink by half a trillion dollars in just a month, and the debate over how to regulate it has become increasingly political.
A Regulator in Need of Reinforcement
The CFTC, for its part, may not be ready for the workload. The agency currently operates with just one active commissioner, Caroline Pham, after a string of departures left its five-member leadership nearly empty. Trump’s pick to fill the top job — former CFTC lawyer Mike Selig — is still awaiting Senate confirmation.
Democrats argue that transferring oversight without boosting resources could turn the CFTC into a paper tiger, unable to keep pace with the scale and complexity of the crypto market. Republicans counter that the SEC’s heavy-handed enforcement under Chair Gary Gensler has driven innovation offshore, leaving the U.S. behind.
What the Draft Leaves Out
While the bill outlines broad oversight powers for the CFTC, it notably avoids tackling the two most divisive issues in crypto policy — DeFi regulation and anti–money laundering enforcement. Democrats want new rules to cover decentralized protocols; Republicans insist the government should not interfere with code-based systems that lack centralized control.
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That omission could become the biggest roadblock to bipartisan support. The Senate Agriculture Committee, which oversees the CFTC, has not yet scheduled a hearing, though staffers confirm that private negotiations are under way.
Lobbyists Flood Capitol Hill
Crypto lobbying has surged since the Trump team returned to power. Executives from Coinbase, Circle, and other leading firms were seen in Senate offices throughout October, urging lawmakers to pass a framework that treats digital assets more like commodities than securities. According to insiders, the industry’s message is clear: regulation is welcome — just not from the SEC.
Still, passing the measure won’t be easy. Even if every Republican backs it, the bill would need at least seven Democratic votes to clear a filibuster. Without concessions on consumer protection and oversight of decentralized projects, analysts say the path forward remains narrow.
Self-Custody Rights and Market Reaction
One clause in the draft has caught particular attention — a guarantee that individuals can hold their own digital assets, provided they comply with sanctions and financial-crime laws. Supporters say this enshrines the principle of self-custody at a federal level; critics argue it opens the door to untraceable transfers under the guise of “personal freedom.”
For now, the markets appear largely indifferent. Bitcoin is trading below $105,000, while total crypto capitalization slipped another 1.5% over the past day. The muted reaction reflects uncertainty more than optimism — traders know that the shape of U.S. regulation could change everything.
The Bigger Picture
If passed, the bill would mark the most significant redistribution of regulatory power since cryptocurrencies emerged over a decade ago. Beyond the technical details lies a deeper political battle: whether the U.S. will approach blockchain through the lens of enforcement and risk, or through the lens of innovation and growth.
With the CFTC understaffed and the SEC under fire, Washington’s next steps will determine not just who regulates crypto — but what kind of financial future the U.S. wants to build.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
