Regulatory update: Senate Ag advances digital asset bill, CFTC and SEC launch Project Crypto

a16z crypto Regulatory Team
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Editor’s note: Our Regulatory Updates series highlights the latest regulatory, legal, and policy happenings relevant to the crypto industry, curated by the a16z crypto regulatory team.

Regulatory Update: December 23, 2025 – February 3, 2026

tl;dr

  • The U.S. Senate Committee on Agriculture, Nutrition, and Forestry advanced its version of a digital asset market structure bill, which would provide new authority to the CFTC to regulate digital commodities and strengthen consumer protections for the emerging market. Senate Banking Committee Chair Tim Scott (R-S.C.) announced that the Banking Committee will postpone its markup of digital asset market structure legislation as bipartisan negotiations continue.
  • The CFTC and the SEC held a joint event to discuss harmonization between the two agencies and their efforts to deliver on President Trump’s promise to make the United States the crypto capital of the world. CFTC Chair Michael S. Selig and SEC Chair Paul S. Atkins gave remarks. CFTC Chair Selig made a number of announcements, including that the CFTC will partner with the SEC on Project Crypto, and that he has directed CFTC staff to work with SEC staff to consider joint codification of Chair Atkins’s “common-sense crypto asset taxonomy” as an interim measure while Congress finalizes legislation.
  • The SEC’s Division of Corporation Finance, Division of Investment Management, and Division of Trading and Markets issued a statement providing their views on the taxonomies associated with tokenized securities.
  • The World Economic Forum at Davos 2026 featured panels on digital assets, including on tokenization and stablecoins.

🌽 Commodity Futures Trading Commission

  • As mentioned in “tl;dr,” the CFTC and the SEC held a joint event to discuss harmonization between the two agencies and their efforts to deliver on President Trump’s promise to make the United States the crypto capital of the world. CFTC Chair Michael S. Selig and SEC Chair Paul S. Atkins gave remarks. CFTC Chair Selig made a number of announcements, including that the CFTC will partner with the SEC on Project Crypto, and that he has directed CFTC staff to work with SEC staff to consider joint codification of Chair Atkins’s “common-sense crypto asset taxonomy” as an interim measure while Congress finalizes legislation.
  • CFTC Chair Michael S. Selig announced a “Future Proof” initiative, which will have the CFTC’s staff “undertake a comprehensive review of the agency’s existing rules and regulations and modernize these requirements to ensure a level playing field for new entrants and incumbents alike.”
  • The CFTC’s Division of Market Oversight and the Division of Clearing and Risk issued a no-action letter stating that the divisions will not recommend an enforcement action against Bitnomial Exchange or Bitnomial Clearinghouse for failure to comply with certain swap-related recordkeeping requirements and for failure to report to swap data repositories data associated with event contract transactions executed on or subject to the rules of the exchange and cleared through the clearinghouse.

🦅 Congress

  • As mentioned in “tl;dr,” the U.S. Senate Committee on Agriculture, Nutrition, and Forestry advanced its version of a digital asset market structure bill, which would provide new authority to the CFTC to regulate digital commodities and strengthen consumer protections for the emerging market. Senate Banking Committee Chair Tim Scott (R-S.C.) announced that the Banking Committee will postpone its markup of digital asset market structure legislation as bipartisan negotiations continue.
  • House Representative Maxine Waters (D-Cal.) sent a letter to HFSC Chair French Hill (R-Ark.) urging him to hold a hearing with SEC Chair Paul S. Atkins and stating that the Committee needs to “promptly oversee the SEC’s actions” in regard to its dismissal of “major crypto enforcement actions.” Representative Waters and others also sent a letter to Chair Atkins expressing concern regarding the SEC’s “dramatic retrenchment from its responsibility to investigate and prosecute cases involving crypto asset securities.” 
  • Senator Elizabeth Warren (D-Mass.) sent a letter to Comptroller of the Currency Jonathan V. Gould urging the Office of the Comptroller of the Currency to delay its review of a bank charter application submitted by World Liberty Financial. Comptroller Gould responded that the “OCC has a duty to act on the applications it receives in a timely manner.”
  • Senator Elizabeth Warren (D-Mass.) wrote to SEC Chair Paul S. Atkins requesting information about how the SEC will protect investors following President Trump’s Executive Order that “clear[s] the way for pension funds and retirement accounts to hold volatile crypto assets.”
  • Senators Mazie K. Hirono (D-Hawaii) and others wrote to Deputy Attorney General Todd W. Blanche accusing him of potentially violating federal law, or at least having a “glaring conflict of interest” that required recusal when he decided “to scale back the [DOJ’s] cryptocurrency enforcement efforts.”

⚖ Department of Justice

  • A Utah man was sentenced to 36 months in prison after he admitted that he operated an unlicensed money transmitting business where cash was converted into crypto. He was also sentenced to serve a concurrent sentence after pleading guilty to wire fraud that cost investors more than $2.9 million.
  • A Chinese national was sentenced to 46 months in prison for his role in laundering more than $36.9 million from victims in a digital asset investment conspiracy that was carried out from scam centers in Cambodia.
  • A federal judge entered a final order of forfeiture in connection with more than $400 million in seized cryptocurrencies, real estate, and monetary assets tied to the operation of the darknet mixing service, Helix.

💵 Department of the Treasury

  • OFAC designated two digital asset exchanges linked to a criminal Iranian investor that have processed funds associated with IRGC-linked counterparties. This is OFAC’s first designation of a digital asset exchange for operating in the financial sector of the Iranian economy.

📈 Securities and Exchange Commission

  • As mentioned in “tl;dr,” the SEC’s Division of Corporation Finance, Division of Investment Management, and Division of Trading and Markets issued a statement providing their views on the taxonomies associated with tokenized securities.
  • The SEC’s Division of Corporation Finance issued a no-action letter to MegPrime Holding LLC stating that it would not recommend enforcement action if it offers and sells MegPrime tokens in the manner and under the circumstances described in its letter without registration under Section 5 of the Securities Act and does not register the MegPrime tokens as a class of equity securities under Section 12(g) of the Exchange Act.
  • SEC Commissioner Hester M. Peirce discussed crypto market structure legislation, tokenization, and other issues on Bloomberg Crypto. 
  • SEC Director of Division of Trading and Markets Jamie Selway said that the Division has “engaged with market participants – both ‘TradFi’ incumbents and ‘DeFi’ new entrants – across the waterfront of tokenized securities operations,” and that it will soon “take up the pen on rulemaking proposals.”
  • The Zcash Foundation announced that the SEC had informed them that the agency has closed an investigation into the foundation. 
  • The SEC filed a joint stipulation with Gemini Trust Company, LLC to dismiss, with prejudice, the Commission’s ongoing civil enforcement action against it.
  • The SEC dismissed its administrative proceedings against American CryptoFed DAO​​.

🏛 White House

  • President Trump spoke at Davos and said that he is working to ensure that the United States remains the “crypto capital of the world,” and he hopes to sign crypto market structure legislation soon. 
  • White House AI & crypto czar David Sacks joined “Squawk Box” to discuss crypto market structure legislation and other issues.

State

🐻 California

  • California’s DFPI announced that Nexo Capital will pay $500,000 in penalties for violating California financial laws, including making loans to California residents without a valid license.

🦞 Maine

  • Maine’s Bureau of Consumer Credit Protection announced that the Bureau entered into a consent agreement with crypto kiosk operator Bitcoin Depot “that recovers $1.9 million taken by third-party scammers who defrauded Maine consumers through their kiosks.”

🗽 New York

  • Manhattan District Attorney Alvin Bragg and New York State Senator Zellnor Myrie (D-Brooklyn) announced new legislation that, if passed, would criminalize the operation of virtual currency business in the state without a license.

International

🇦🇺 Australia

  • The Australian Securities and Investments Commission highlighted key issues for 2026, including “[r]egulatory gaps related to emerging financial sector participants (digital assets, payments, users of AI) and others on the regulatory perimeter.”
  • The Federal Court imposed $14 million in penalties on BPS Financial Pty Ltd (BPS Financial) for its promotion and operation of its “Qoin Wallet” crypto product.

🇪🇺 European Union

  • The European Commission opened infringement procedures by sending a letter of formal notice to 12 Member States calling on them to fully implement the new tax transparency and information exchange rules on crypto assets.
  • The European Central Bank announced that the Eurosystem will accept marketable assets issued in central securities depositories using distributed ledger technology as eligible collateral for Eurosystem credit operations.
  • Ripple announced that it received full approval of its Electronic Money Institution license from Luxembourg’s Commission de Surveillance du Secteur Financier.

🇫🇷 France

  • The French Autorité des marchés financiers (AMF) issued its “Action and Supervisory Priorities 2026,” which includes a section on priorities relating to crypto-asset service providers. 
  • The French AMF issued warnings to the public relating to the activities of several unauthorized entities in connection with crypto assets.

🇰🇷 South Korea

  • South Korea’s Financial Intelligence Unit imposed an institutional warning and a fine of KRW 2.73 billion ($1.9 million) on crypto exchange Korbit for violating its anti-money laundering obligations. It also issued disciplinary measures against senior Korbit executives.

🇹🇲 Turkmenistan

  • Turkmenistan passed a law legalizing cryptocurrency mining and crypto exchanges.

🇦🇪 United Arab Emirates

  • The Dubai Financial Services Authority formally enacted its updated regulatory framework for crypto tokens in the Dubai International Financial Centre.

🇬🇧 United Kingdom

  • The FCA announced a new gateway for firms to apply for authorization to undertake new regulated activities for cryptoassets and that it expects the application window for firms to begin applying will open in September 2026.
  • Avian Labs received approval to operate as a crypto services provider from the UK’s FCA.
  • Ripple announced that it has secured approval of its Electronic Money Institution license and Cryptoasset Registration from the UK’s FCA.

🇻🇳 Vietnam

  • Vietnam’s State Securities Commission announced that it has begun accepting applications for a crypto asset market pilot regime.

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