Are you trying to earn money online with digital assets but worry about the rules that govern them? This article explains how cryptocurrency regulation is structured in the United States, who the key players are, and how political changes can affect the stability of those rules.
What the regulatory framework looks like
In the United States, crypto regulation is a patchwork of laws administered by several federal agencies. The two most active regulators are the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). The SEC treats many crypto tokens as securities, meaning they must comply with securities‑law registration, disclosure, and anti‑fraud requirements. The CFTC, on the other hand, views most cryptocurrencies as commodities, giving it authority over derivatives, futures contracts, and market manipulation.
Because Congress has not passed a comprehensive “digital‑asset” law, both agencies rely on existing statutes—such as the Securities Act of 1933, the Investment Company Act of 1940, and the Commodity Exchange Act—to justify their rules. This approach can create overlapping or conflicting guidance, leaving businesses and investors uncertain about which rules apply.
Beyond the SEC and CFTC, other bodies may get involved. The Financial Crimes Enforcement Network (FinCEN) enforces anti‑money‑laundering (AML) and know‑your‑customer (KYC) rules, while the Internal Revenue Service (IRS) treats crypto as property for tax purposes. State regulators can also impose licensing requirements, especially for money‑transmission activities.
Real‑world illustration
In an opinion piece published on October 6, 2026, former New York Governor Andrew M. Cuomo warned that the United States lacks durable, bipartisan crypto legislation. He noted that the House passed the CLARITY Act in 2025, but the Senate never sent the bill to the president. As a result, the SEC and CFTC have been “hyper‑aggressive” in issuing new rules, filling the regulatory void left by Congress. Cuomo argued that because these agency rules were adopted without a clear congressional mandate, they are vulnerable to reversal after the next election.
What this means for you
If you earn passive income through staking, lending, or cloud mining, the regulatory environment directly impacts the platforms you use. Agency rules can change the types of assets a platform may offer, the fees it can charge, and the disclosures it must provide. A sudden regulatory shift—such as the SEC deciding that a particular token is a security—could force a platform to suspend services, freeze assets, or require additional verification from users.
Because agency guidance can be revised quickly, the stability of your earnings may depend on how well a platform adapts to new compliance demands. Platforms that have built robust legal teams and diversified their product offerings across multiple jurisdictions tend to weather regulatory changes more smoothly.
How to evaluate a platform’s regulatory resilience
- Know the regulator(s): Identify whether the platform is primarily overseen by the SEC, CFTC, FinCEN, or a state authority. Different regulators impose different compliance burdens.
- Check for licenses: Look for registrations with the SEC (e.g., as a broker‑dealer), CFTC (as a futures commission merchant), or state money‑transmitter licenses. Licensed entities are more likely to have compliance processes in place.
- Review public disclosures: Reputable platforms publish compliance policies, AML/KYC procedures, and risk warnings. Transparency is a good sign of regulatory awareness.
- Assess jurisdictional diversification: Platforms that operate in multiple countries often have contingency plans for regulatory shifts in any single market.
- Monitor regulatory news: Keep an eye on announcements from the SEC, CFTC, and Congress. Even if a new law is not yet enacted, agency rule proposals can signal upcoming changes.
FAQ
Is crypto considered a security or a commodity?
The classification depends on the specific token and its use case. The SEC treats many tokens that are sold as investments as securities, while the CFTC classifies most native cryptocurrencies (like Bitcoin) as commodities. The same token can be viewed differently by each agency, which is why clear guidance is essential.
What happens if a platform’s services become non‑compliant?
Non‑compliant platforms may be forced to suspend operations, restrict withdrawals, or even shut down. Users could experience delayed access to funds and may need to relocate assets to a compliant service.
Can I rely on state‑level crypto licenses?
State licenses, such as money‑transmitter permits, add a layer of consumer protection but do not replace federal oversight. They are useful indicators of a platform’s willingness to comply with regulations, but federal agency rules still apply.
Do political elections really affect crypto rules?
Yes. Changes in congressional composition can alter the legislative agenda, affect funding for regulatory agencies, and trigger the use of tools like the Congressional Review Act to overturn agency rules. This political risk is why many industry leaders call for bipartisan, statutory frameworks that endure beyond election cycles.
This article references reporting from cointelegraph.com.
