This bill establishes rules for regulating digital assets like cryptocurrencies. It gives the Commodity Futures Trading Commission (CFTC) authority to oversee digital assets that use decentralized blockchains, while the Securities and Exchange Commission (SEC) would regulate digital assets with less decentralized blockchains. The bill also includes exceptions to SEC regulation for some smaller digital assets and sets requirements for digital asset transactions.
Latest Action
Received in the Senate and Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.
AI Summary
Plain-English explanation of this bill
This bill establishes rules for regulating digital assets like cryptocurrencies. It gives the Commodity Futures Trading Commission (CFTC) authority to oversee digital assets that use decentralized blockchains, while the Securities and Exchange Commission (SEC) would regulate digital assets with less decentralized blockchains. The bill also includes exceptions to SEC regulation for some smaller digital assets and sets requirements for digital asset transactions.
Last updated: 12/29/2025
Official Summary
Congressional Research Service summary
<p><b>Financial Innovation and Technology for the 21st Century Act </b></p> <p>This bill establishes a regulatory framework for digital assets. </p> <p>The Commodity Futures Trading Commission (CFTC) must regulate a digital asset as a commodity if the blockchain, or digital ledger, on which it runs is functional and decentralized. The bill classifies a blockchain as decentralized if, among other requirements, no person has unilateral authority to control the blockchain or its usage, and no issuer or affiliated person has control of 20% or more of the digital asset or the voting power of the digital asset. In addition, the bill provides the CFTC with exclusive regulatory authority over cash or spot markets for digital commodities.</p> <p> The Securities and Exchange Commission (SEC) must regulate a digital asset as a security if its associated blockchain is functional but not decentralized. However, the bill establishes certain exceptions to SEC regulation for digital assets that limit annual sales, restrict nonaccredited investor access, and satisfy disclosure and compliance requirements. The bill also sets forth requirements for primary and secondary market transactions. </p> <p>The CFTC and SEC must jointly issue rules to define terms and exempt dually registered exchanges from duplicative rules. </p> <p>The bill excludes permitted stablecoins from CFTC and SEC regulation, except regarding anti-fraud authority and specified transactions on registered entities.</p>
Key Points
Main provisions of the bill
The CFTC would regulate digital assets using decentralized blockchains, while the SEC would regulate digital assets with less decentralized blockchains
The bill includes exceptions to SEC regulation for some smaller digital assets that limit annual sales, restrict nonaccredited investor access, and meet disclosure requirements
The bill sets requirements for primary and secondary market transactions involving digital assets
How This Impacts Americans
Potential effects on citizens and communities
This bill would impact companies and individuals involved in digital asset markets, including cryptocurrency exchanges, developers, and investors. It would establish clearer regulatory oversight for the digital asset industry, potentially reducing uncertainty and encouraging more investment and innovation in this space.
Policy Areas
Primary Policy Area
Finance and Financial Sector
Related Subjects
Administrative law and regulatory procedures
Advanced technology and technological innovations
Commodities markets
Commodity Futures Trading Commission
Computers and information technology
Currency
Digital media
Licensing and registrations
Securities
Securities and Exchange Commission (SEC)
Scope & Jurisdiction
Jurisdiction Level
federal
Congressional Session
119th Congress
Citation Reference
4763, 119th Congress (2025). "PTO Act". Source: Voter's Right Platform. https://votersright.org/bills/118-hr-4763
