SEC vs CFTC: who regulates crypto in the US?

What do the SEC and CFTC each regulate?

The US splits financial oversight by product, not by technology. The Securities and Exchange Commission (SEC) describes its mission in three parts: protecting investors, keeping markets fair, orderly and efficient, and helping businesses raise capital. It oversees broker-dealers, investment advisers, securities exchanges and companies that sell securities to the public.

The Commodity Futures Trading Commission (CFTC), created in 1974, regulates derivatives — futures, options and swaps. A derivative is a contract whose value comes from something else, such as wheat, oil or bitcoin. The CFTC's stated mission is to promote the integrity, resilience and vibrancy of US derivatives markets.

Crypto sits awkwardly across this line because the same token can be bought outright, traded as a futures contract, or wrapped inside a fund. Each of those wrappers can fall to a different agency.

When is a crypto-asset a security?

The test comes from a 1946 Supreme Court case, SEC v. W.J. Howey Co. Under it, an arrangement is an investment contract — and therefore a security — when there is an investment of money, in a common enterprise, with an expectation of profits from the efforts of others.

On 17 March 2026 the SEC published an interpretation, joined by the CFTC, on how that test applies to crypto. It sorts crypto-assets into five groups: digital commodities, digital collectibles, digital tools, stablecoins and digital securities. The SEC says the first three are not themselves securities, and it names bitcoin and ether as examples of digital commodities. Stablecoins get a split answer. Payment stablecoins from permitted issuers will categorically not be securities once the GENIUS Act takes effect; until then, the SEC treats a group it calls covered stablecoins as not involving securities. Other stablecoins may or may not be securities, depending on the facts and circumstances. A digital security — a tokenized share or bond — stays a security, because, in the SEC's words, a security is a security whether it is issued offchain or onchain.

The interpretation also separates the token from the deal around it. A non-security token can become subject to an investment contract when its issuer invites people to invest by promising the essential managerial work that will make it succeed. The SEC says that contract can end once those promises are fulfilled — or clearly fail. The interpretation expresses the Commission's views; it does not replace Howey, which remains binding case law.

What does the CFTC actually oversee in crypto?

The CFTC's clearest power is over crypto derivatives: bitcoin futures, ether futures and swaps on digital assets. Firms that offer those products to US customers generally must register with the CFTC and follow its rules.

Spot trading — buying and selling the token itself for immediate delivery — is different. A CFTC explainer on its digital-asset authority stresses that the agency does not regulate cash commodities or the people who buy and sell them. What it does have is anti-fraud and anti-manipulation authority over those markets. In 2018 a federal court in Massachusetts agreed, in CFTC v. My Big Coin Pay, that virtual currencies are commodities under the Commodity Exchange Act, so the CFTC could pursue fraud involving them.

Products built on top of spot assets add another layer. A spot bitcoin ETF holds bitcoin, but the fund's shares are securities traded on stock exchanges, so the fund itself falls under securities law.

What changed in 2025 and 2026?

Three official steps redrew the map without any new statute:

1. 2 September 2025 — joint staff statement. SEC and CFTC staff said that exchanges registered with either agency are not prohibited from facilitating trading in certain spot crypto products.

2. 5 September 2025 — harmonization statement. SEC Chairman Paul Atkins and CFTC Acting Chairman Caroline Pham said the agencies should consider harmonizing product and venue definitions, reporting and data standards, and capital and margin rules, and coordinating exemptions for new products.

3. 17 March 2026 — the joint interpretation. The SEC, joined by the CFTC, set out its crypto taxonomy, and the CFTC said it would apply commodity law consistently with it.

Congress tried to make the split permanent. The Digital Asset Market Clarity Act (CLARITY Act) would give the CFTC authority over centralized exchanges and intermediaries in secondary markets for digital commodities, while the SEC keeps securities, including tokenized securities. The House passed it 294–134 on 17 July 2025. On 15 September 2026 a Senate motion to move to the bill failed 49–50, short of the 60 votes needed. As of October 2026 the CLARITY Act is not law. The current split rests on agency interpretations and statements, not on a market-structure law passed by Congress.

Which agency covers what you are doing?

The answer depends on the activity, not the coin. The same bitcoin can sit under different rules depending on how you hold it.

Spot exchanges and payment firms still face other federal rules, notably anti-money-laundering registration — see KYC and AML explained. Before using any platform, look it up in the official registers described in how to check if a platform is registered.

What mistakes do beginners make about SEC and CFTC rules?

• Thinking "not a security" means "regulated and safe". A token the SEC calls a digital commodity can still trade on venues no federal agency supervises day to day.
• Confusing the token with the product. Bitcoin, a bitcoin future and a bitcoin ETF share each fall under different rules.
• Treating an interpretation as a statute. The 2026 interpretation reflects the current Commission's views; Congress has not yet written the split into law.
• Assuming a stalled bill settles the question. Congress can return to market-structure legislation at any time. Check House and Senate records for the latest status.
• Reading enforcement headlines as rules. A lawsuit against one firm describes alleged conduct; it does not by itself classify every similar token.