Project 2025 Tracker / What’s done, what’s next

27. Financial Regulatory Agencies · Notable

Issue a joint SEC-CFTC rule defining when a digital asset is a security

Partially done

835 27. Financial Regulatory Agencies

“Promulgate a joint regulation providing that a holder of digital assets may not be deemed a party to an investment contract or an investor in a common enterprise unless, while the enterprise is a going concern, the holder is entitled to a share of the earnings or profits of the common enterprise or a defined flow of payments from the common enterprise in consideration of the investment or unless, upon liquidation, the holder has rights against the assets of the common enterprise. Otherwise, the digital asset shall be deemed a commodity to be regulated by the CFTC, not the SEC.”

What has happened

  1. Partially done

    The joint instrument the Quote asks for was issued and took effect the day it was published: a single Federal Register document carrying both agencies' RINs, in which the SEC interprets the definition of "security" as applied to crypto assets and the CFTC gives guidance that it and its staff will administer the Commodity Exchange Act consistently. It classifies crypto assets into digital commodities, digital collectibles, digital tools, stablecoins and digital securities; holds that the first three "are not themselves securities"; states that a digital commodity "does not have intrinsic economic properties or rights, such as generating a passive yield or conveying rights to future income, profits, or assets of a business enterprise"; and records at note 48 that any non-security crypto asset other than a permitted payment stablecoin "could meet the definition of `commodity' under the Commodity Exchange Act". It names sixteen assets, from Bitcoin and Ether to XRP, as digital commodities. Not `done`, because the operative test is not the one the Quote specifies: a non-security crypto asset becomes subject to an investment contract when the issuer makes "representations or promises to undertake essential managerial efforts from which a purchaser would reasonably expect to derive profits" — the Howey test — rather than only where the holder is entitled to a share of earnings, a defined flow of payments or rights on liquidation.

  2. Attempted

    The two agencies entered a Memorandum of Understanding and created a Joint Harmonization Initiative whose first listed workstream is "Clarifying product definitions through joint interpretations and rulemakings", alongside a "fit-for-purpose regulatory framework for crypto assets". The MOU commits the agencies to a process; it decides nothing about when a digital asset is a security.

  3. Attempted

    The SEC Chairman and the CFTC Acting Chairman issued a joint statement on regulatory harmonization and announced a joint roundtable for 2025-09-29, saying their agencies "should consider harmonizing product and venue definitions; streamlining reporting and data standards; aligning capital and margin frameworks; and standing up coordinated innovation exemptions using each agency's existing exemptive authority". It followed a joint staff statement three days earlier that SEC- and CFTC-registered exchanges are not prohibited from facilitating trading in certain spot crypto asset products. Statements of intent by the two Chairmen; still no joint rule.

  4. Attempted

    Executive Order 14178 made regulatory clarity for digital assets administration policy and set up the machinery for it. Section 1(a)(iv) commits the administration to "providing regulatory clarity and certainty ... and well-defined jurisdictional regulatory boundaries"; section 4 establishes the President's Working Group on Digital Asset Markets with both the SEC Chairman and the CFTC Chairman as members, requires every relevant agency to identify within 30 days all regulations, guidance and orders affecting the digital asset sector and to recommend within 60 days whether each should be rescinded or modified, and requires the Working Group to report within 180 days proposing "a Federal regulatory framework governing the issuance and operation of digital assets". A directive to propose a framework, with no joint regulation yet.

Research log

What was searched, and what didn’t count as evidence

Research notes

  • The joint release was read in full at https://www.govinfo.gov/content/pkg/FR-2026-03-23/html/2026-05635.htm. It is filed under CFTC RIN 3038-AF67 and SEC RIN 3235-AN56, is styled “Final rule; interpretation; guidance”, and is effective 2026-03-23.
  • Why partial and not done. The Quote asks for a rule under which a holder “may not be deemed a party to an investment contract or an investor in a common enterprise unless” entitled to a share of earnings or profits, a defined flow of payments, or rights against the assets on liquidation. Section IV of the release adopts a different gate: representations or promises of essential managerial efforts, conveyed to purchasers before or at the sale. The two overlap heavily — the digital-commodity definition is framed in almost the Quote’s terms — but a token sold with a managerial-effort promise and no economic entitlement is inside an investment contract under the release and outside one under the Quote. The outcome half of the ask (“otherwise the digital asset shall be deemed a commodity to be regulated by the CFTC, not the SEC”) is delivered. The alternative reading, done, is in the spot-check register.
  • The CFTC’s half is guidance, not a rule. The release says the SEC “issues herein an interpretation” and the CFTC “provides herein guidance relating to that interpretation”; release 9198-26 puts it as the CFTC giving “guidance the CFTC and its staff will administer the Commodity Exchange Act consistent with the SEC’s interpretation”. That is a second reason the delivery is partial.
  • What is still only proposed. The SEC published Regulation Crypto Assets on 2026-08-21 (https://www.federalregister.gov/documents/2026/08/21/2026-17183/regulation-crypto-assets), which would build a registration and exemption framework on top of the interpretation. The two agencies also issued three joint requests for comment in June 2026 — on swap and security-based swap data reporting (2026-12742), on the further definition of “swap” and “security-based swap” (2026-12743), and on portfolio margining and cross-margining (2026-13182). All are proposals and none is cited as Evidence here.
  • Leads. The joint staff statement on spot crypto asset products of 2025-09-02 (https://www.cftc.gov/PressRoom/PressReleases/9112-25) is staff-level and predates the Commission-level action; the CFTC’s Crypto Sprint and the SEC’s Project Crypto are program names rather than instruments; the President’s Working Group report of 2025 is cited in release 9112-25 but was not itself fetched.
Action
issue
Object
a joint SEC–CFTC regulation on the treatment of digital assets
ID
2164