A bipartisan pair of U.S. senators is moving ahead with a proposal that could shift primary oversight of the cryptocurrency market to the Commodity Futures Trading Commission (CFTC). This move is viewed by some as an industry-driven shift quietly backed by the Trump administration.
The discussion draft is being spearheaded by Senator John Boozman (R-Ark.) and Senator Cory Booker (D-N.J.), arriving at a time when the digital assets market is already experiencing significant turbulence. Over the past 30 days, the cumulative crypto market capitalization has fallen from the $4 trillion mark to hover around $3.5 trillion. Bitcoin’s price similarly dropped by nearly 6% during the same period.
### Senators Push to Curb the SEC’s Power
According to reports, the draft legislation would classify most cryptocurrencies as digital commodities rather than securities. This means that exchanges and trading platforms would fall under the jurisdiction of the CFTC instead of the Securities and Exchange Commission (SEC).
Such a shift would introduce a new regime of registration requirements, disclosure rules, and fee structures for companies operating in the crypto space. Senator Booker described the proposal as a first step, acknowledging that the legislation is far from finalized.
However, a major challenge lies in the CFTC’s current capacity to manage these new responsibilities. The agency is severely understaffed, currently operating with only one active commissioner—Caroline Pham—remaining on its five-member panel following several resignations.
Trump’s nominee to lead the agency, former CFTC lawyer Mike Selig, is still awaiting Senate confirmation. This staffing shortage has become a central issue in the political debate.
Democrats are concerned that transferring oversight to the CFTC without significantly expanding its resources would lead to insufficient supervision of the crypto market, which is still in an expansion phase. On the other hand, Republicans view the CFTC as a more predictable and less punitive regulator compared to the SEC.
### Contentious Issues Sidestepped
The report also highlights that the bill sidesteps two of the most contentious issues in crypto policy—decentralized finance (DeFi) and anti-money laundering enforcement.
Democrats are seeking explicit regulatory authority over decentralized protocols, while Republicans prefer to leave these largely untouched.
### Crypto Industry Lobbying Intensifies
Lobbying efforts have intensified since the new administration took office. In October, executives from major firms including Coinbase and Circle engaged in extensive discussions with Senate offices, indicating that progress on market structure legislation may be stalled without Democrats’ support.
Even if all Republicans back the bill, at least seven Democratic votes are required to overcome a filibuster, leaving the bill’s future uncertain.
### Key Provisions of the Draft Bill
A crucial aspect of the draft is not just about who regulates crypto, but how. The bill reportedly aims to protect individuals’ right to self-custody of digital assets, allowing them to hold and transact directly. However, these individuals would need to prove they are not violating sanctions or criminal laws.
As of now, the Senate Agriculture Committee has not scheduled a hearing on the draft, but the legislation’s outlines are formally on the table.
### Market Reaction
The crypto market showed muted reaction to the proposal — the cumulative market cap dipped by roughly 1.5% over the last 24 hours. Bitcoin’s price remains below the $105,000 mark but is still up nearly 12% on a year-to-date (YTD) basis.
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https://bitcoinethereumnews.com/crypto/bipartisan-pair-of-us-senators-push-proposal-to-shift-crypto-oversight-to-cftc/
