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Crypto Law/Level III · Tokens and securities law/3.2 US rules in motion/Lesson 5

Market-structure legislation

The bills that would divide crypto markets between the SEC and the CFTC, what the House passed, what the Senate changed, and why none was law in October 2026.

Education, not legal, tax or investment advice. Crypto law differs between countries and states and changes often. Check the current rules where you live with a qualified lawyer or tax adviser before you act.

The lean path

The cheapest, lowest-tax, simplest and most private route the law allows, best first. Each step names the rule it rests on and the condition that keeps it lawful.

  1. Cheapest course is to plan only on current law, not on any bill: the CLARITY Act (H.R. 3633) passed the House in July 2025 but stalled after a 49-50 Senate cloture vote on 15 September 2026, so nothing in it applies.
  2. Today’s lean routes come from the SEC’s March 2026 interpretation: no-consideration airdrops and launches without promises of managerial effort need no registration. The catch: the interpretation is agency policy that courts and a future Commission can revise.
  3. Design for both draft texts at no extra cost: keep control of the network and treasury dispersed so no person or commonly controlled group controls it, the House ‘mature blockchain’ test. Definitions and caps such as the $50 million annual exemption may change before enactment.
  4. Track the bill free on congress.gov ‘All Actions’ and compare definitions only against the latest version; any law would still need House-Senate agreement and agency rules with later effective dates.

MaterialsThe bill-status page for H.R. 3633 (the CLARITY Act) on congress.gov or govinfo.gov, read from the latest action backwardsThe House-passed text (engrossed version) and the Senate Banking Committee’s reported substitute of 1 June 2026A one-page table of your own comparing how each version defines a non-security token and who would regulate its trading

Wonder

  1. Why does crypto need a ‘market-structure’ law when the SEC and CFTC already exist?
  2. What would the CLARITY Act actually change for a token project?
  3. Where is the bill now, and what has to happen before it becomes law?

Explore

  1. ‘Market structure’ means the rules for the venues and middlemen of a market: exchanges, brokers, dealers and custodians. For crypto, the gap is jurisdiction. The SEC regulates securities (lesson 1.3.1); the CFTC regulates commodity futures and other derivatives (lesson 1.3.2); but federal law has no registration regime built for spot trading platforms in tokens that are not securities. Market-structure bills try to fix this by defining which tokens are securities and which are ‘digital commodities’, and by creating registrations for the platforms that trade them. Until Congress acts, the agencies work with existing statutes, as lesson 3.2.2 explains.
  2. The first serious attempt was the Financial Innovation and Technology for the 21st Century Act, known as FIT21 (H.R. 4763). It passed the House 279-136 on 22 May 2024 and was referred to the Senate Banking Committee in September 2024, where it went no further. Like every bill not enacted by the end of a two-year Congress, it lapsed when the 118th Congress ended in January 2025. Its core ideas returned in the next Congress: a ‘digital commodity’ category, a test for when a blockchain system is decentralized, and registration of digital commodity exchanges at the CFTC.
  3. The Digital Asset Market Clarity Act, or CLARITY Act (H.R. 3633), was introduced on 29 May 2025 and passed the House 294-134 on 17 July 2025, after the Financial Services (32-19) and Agriculture (47-6) Committees approved it. It defines a ‘digital commodity’ as a digital asset intrinsically linked to a blockchain system whose value comes, or is expected to come, from use of that system. A ‘mature blockchain system’ is one no person or commonly controlled group controls. An issuer could raise up to $50 million a year unregistered, no buyer holding over 10 percent, if it intends the system to mature within four years. The CFTC would register digital commodity exchanges, brokers and dealers.
  4. The Senate received the bill on 18 September 2025 and referred it to the Banking Committee, which voted on 14 May 2026 to report it and filed a full substitute on 1 June 2026. The substitute’s Title I, the ‘Lummis-Gillibrand Responsible Financial Innovation Act of 2026’, uses a different vocabulary: a ‘network token’ is a digital commodity linked to a distributed ledger, and an ‘ancillary asset’ is a network token whose value depends on an originator’s managerial efforts, triggering disclosure duties. Section 404 would bar platforms from paying stablecoin rewards that work like bank-deposit interest while permitting activity-based rewards, and Title VI would shield some software developers and node operators.
  5. As of October 2026 the bill is not law. A motion to proceed was made on 8 August 2026, and on 15 September the Senate voted 49-50 against cloture on that motion, so debate on the bill itself did not begin. Senator Tillis entered a motion to reconsider, which keeps another vote possible. Even if the Senate passes a version, the House and Senate texts differ, so both chambers would have to agree on one text before it goes to the President. Meanwhile the agencies keep acting: on 13 October 2026 the CFTC published an advance notice on crypto rules under section 2(c)(2)(D) of the Commodity Exchange Act, which covers certain retail commodity transactions.
  6. For builders, the trap is planning around a bill as if it were law. Definitions, dollar caps, decentralization tests and effective dates have all shifted between versions and may shift again, and a token’s status could differ under the House and Senate texts. The provisions to watch are the token definitions, the maturity or control test, any offering exemption, the treatment of stablecoin rewards, protection for developers, and the deadlines for agency rules. A practical check: open the bill’s ‘All Actions’ list, note the latest action and the version it refers to, and compare definitions only against that version. Other places already have statutes, such as the EU’s MiCA (lesson 3.3.1).

Key facts

  • FIT21 (H.R. 4763) passed the House 279-136 on 22 May 2024 but was never enacted.
  • The CLARITY Act (H.R. 3633) passed the House 294-134 on 17 July 2025.
  • The House-passed CLARITY Act defines a mature blockchain system as one not controlled by any person or group of persons under common control.
  • The Senate Banking Committee reported H.R. 3633 with a substitute amendment on 1 June 2026.
  • On 15 September 2026 the Senate failed, 49-50, to invoke cloture on the motion to proceed to H.R. 3633.
  • The Senate Banking substitute would bar digital asset service providers from paying stablecoin rewards that are economically equivalent to bank-deposit interest.

Exercise nine, six, three, one

9CollectList up to 9 questions a crypto market-structure law would need to answer for a token you know, such as who regulates its trading, whether its sale is a securities offering, or who holds customer assets (some lists are shorter).
6ClusterSort them into 6 categories: token classification, offering rules, trading-platform registration, custody, stablecoin rewards, and developer or DeFi treatment.
3DistillReduce the 6 categories to 3 groups: questions current law already answers, questions the pending bill would answer, and questions neither clearly answers.
1CrystallizeWrite 1 sentence explaining, in your own words, why a bill passed by one chamber of Congress does not change a token’s legal status.

Fact check

Dates, figures and claims checked against the published sources listed below.

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