CFTC greenlights tokenized cash, blockchain receipts—Senate's CLARITY flop clears the runway for regulators

The US Commodity Futures Trading Commission has revised its guidance to permit registered crypto-related firms to hold customer funds in tokenized form, provided the digital version grants legal and economic rights "the same or functionally equivalent" to those received by holders of the underlying traditional asset. In a Thursday notice, the agency said it updated its frequently asked questions for registered entities, a March guidance package it has now expanded to cover tokenized assets and blockchain-based recordkeeping. The CFTC added that it "would not object" to companies using distributed-ledger technology to maintain required records, formalizing an approach the regulator said is intended to reduce compliance friction for digital-asset intermediaries.

CFTC Chair Michael Selig framed the changes as part of broader efforts "to provide regulatory clarity for the crypto industry," language echoed by SEC Chair Paul Atkins, who told reporters before this week's Senate vote that his agency was "ready, willing, and able" to propose crypto rules in the absence of congressional action. The SEC in August proposed rules addressing "certain investment contracts involving crypto assets," a parallel track that has taken on added weight in Washington following the failed advance of federal market-structure legislation.

The guidance update lands four days after the US Senate failed to garner enough votes to advance the Digital Asset Market Clarity (CLARITY) Act, a bill that would have delineated oversight responsibilities between the CFTC and the Securities and Exchange Commission over digital assets. With the cloture motion falling short, multiple policy watchers now expect Congress will not finalize crypto market structure legislation before 2027, opening space for the CFTC, SEC and other agencies to advance policy through formal rulemaking rather than statutory direction. The CFTC has already submitted a crypto market regulation plan to the White House for review, and Atkins has signaled the SEC intends to move on investment-contract rules even without a congressional compass.

Under the revised CFTC FAQ, authorized entities may deploy tokenized dollars and tokenized equivalents of permitted investments so long as holders' rights mirror those of the traditional asset, a standard the agency described as "functionally equivalent" rather than identical. The same update addresses blockchain recordkeeping, stating that registered firms may keep required books and records on-chain without objection from CFTC examiners, provided the records remain accurate, retrievable and available for inspection. Officials did not specify which tokenized assets or which blockchains would qualify, leaving those determinations to be made case by case as firms file updates to their compliance programs.

The combined effect is a regulator-by-regulator construction of crypto rules in the United States at a moment when the legislative branch has paused on market structure, and both the CFTC and SEC have publicly committed to filling the gap through formal guidance and rulemaking.