SEC and CFTC Announce ‘New Beginning’ of Regulatory Cooperation to Foster Crypto Innovation
In a joint statement, the heads of the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have announced a “new beginning” for coordination between the two agencies, a move aimed at fostering innovation and bringing novel financial products back to the United States. The two top U.S. market regulators are now publicly committing to harmonizing their rules to create a clearer and more predictable environment for innovators, particularly in the rapidly evolving digital asset space.
A Pledge to End the “Regulatory No Man’s Land”
At the heart of the joint statement is a clear acknowledgment that a lack of coordination between the two agencies has “chilled productive economic activity” and driven innovative products overseas. The SEC Chairman and the CFTC Acting Chairman stated that the era of “regulatory uncertainty” that created a “regulatory ‘no man’s land’ due to inaction” is now over.
“It is a new day at the SEC and the CFTC, and today we reaffirm the need to ensure regulation does not stand in the way of progress,” the statement reads. “By working in lockstep, our two agencies can harness our nation’s unique regulatory structure into a source of strength for market participants, investors, and all Americans.”
A Roadmap for Harmonization and Innovation
The statement is more than just a declaration of intent; it lays out a concrete roadmap for future cooperation. The agencies are planning a joint roundtable on regulatory harmonization on September 29, 2025, where they will discuss a range of key issues.
The areas targeted for potential harmonization and innovation include:
- 24/7 Markets: The agencies will collaborate to consider expanding trading hours for certain asset classes to better align U.S. markets with the “always-on” global economy.
- Event Contracts: The regulators will work together to provide clarity for the rapidly growing prediction market industry, including those based on securities, to ensure these products can be offered responsibly to U.S. market participants.
- Perpetual Contracts: The agencies will consider concurrent steps to “onshore” perpetual contracts, a popular type of derivative in offshore crypto markets that has been limited in the U.S. due to jurisdictional constraints.
- Portfolio Margining: A coordinated framework for portfolio margining is on the table, a move that could significantly reduce capital inefficiencies by allowing market participants to net offsetting positions across SEC- and CFTC-regulated products.
A New Approach to DeFi and “Innovation Exemptions”
Perhaps most significantly, the statement addresses the rise of decentralized finance (DeFi). Both agencies have reaffirmed their preparedness to consider “innovation exemptions” or “safe harbors” that would allow market participants to engage in peer-to-peer trading of crypto assets, including derivatives like perpetual contracts, on DeFi protocols.
This would allow commercially viable models to be built while the agencies work on longer-term rulemaking. The statement also strongly affirmed the “core American value” of the right to self-custody one’s assets.
The overarching goal of this new era of cooperation is to “solidify the United States as the global leader in crypto and blockchain technology.” The joint statement is a clear signal to the industry that the nation’s top market regulators are now committed to creating a pro-innovation framework that encourages entrepreneurs to build and launch their products in the U.S.
“Working together, we can ensure that the next chapter of financial innovation is written right here in America,” the statement concludes.
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