It is a big week in Washington, D.C., for the crypto and prediction market industries.
First, the Securities and Exchange Commission announced new rules, Regulation Crypto Assets, to provide a regulated path to issue and trade certain crypto assets. The move was somewhat surprising, as a meeting had been scheduled for last week to review Reg CA. The announcement came without an Open Meeting by the Commission, which rarely happens. The SEC proposal reflects two current securities exemptions: Reg CF and Reg A+. These exemptions allow online capital formation or securities crowdfunding.
Today at the White House, it has been widely reported that President Donald Trump, and perhaps other members of his cabinet like Treasury Secretary Scott Bessent, will participate in a policy discussion on innovation in financial services, with an emphasis on crypto. Both SEC Chairman Paul Atkins and CFTC Chairman Michael Selig will participate. Chatter indicates that representatives from the following platforms are attending, including Coinbase, a16z, Chainlink, Robinhood, Ripple, Paradigm, the Digital Chamber, and others. At one point, representatives from Prediction Markets were expected to participate, but recent reports indicate they are out, for now.
The CLARITY Act, crypto market infrastructure legislation, remains stalled in the Senate. Many insiders expected the legislation to pass earlier this month, but it is now scheduled for a vote on September 15th. The challenge is partisan politics, as Democrats are loath to give the White House a win ahead of the midterms. While some bipartisan support is needed to dodge a filibuster, it remains unclear whether the bill will pass next month.
The Trump administration has declared that dominance in the digital asset sector is a key strategic objective, with the goal of leading the rest of the world in crypto innovation. As it stands today, regulators are poised to move forward with new rules to support innovation while protecting consumers and businesses, but lasting legislation, which is more difficult to undo, hovers in limbo.
The White House meeting is scheduled for 2:30 p.m. ET at the Eisenhower Executive Office Building.
Tomorrow, the CFTC will host its first Innovation Advisory Committee meeting. Last week, Chairman Selig said the US has long led global financial innovation, and the Committee will discuss emerging technologies at the frontier of finance.
The meeting begins at 1 PM ET with a session titled: Crypto’s Regulatory Evolution: From Uncertainty to Clarity.
Two separate sessions later in the day will address Artificial Intelligence in markets and then the emerging Prediction Markets (with representatives from platforms expected to be in attendance).
The US has already approved payment stablecoin regulation under the GENIUS Act, which will help guide the rest of the world. The CLARITY Act could do the same. A growing number of traditional financial services firms have joined in support of the legislation. It is difficult to see how long recalcitrant Democrats can remain an obstacle to much-needed digital asset rules that benefit both the US and consumers.