Recent guidance from the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission establishing a taxonomy for digital assets has put the “final nail” in the SEC’s policy coffin under former chairman Gary Gensler, according to Alex Thorn, head of firm-wide research at investment firm Galaxy.
SEC conductivitypublished on Tuesday, established a taxonomy of digital assets, dividing them into five categories, including digital goods, digital collectibles such as non-fungible tokens (NFTs), digital tools, stablecoins and tokenized securities.
Under the elderly SEC policy framework, regulations determining which cryptocurrencies meet the legal criteria for “investment contracts” were legislative rules, unlike the novel 2026 guidance, which was filed as an interpretive rule, Thorn he said. He explained the meaning:
“This distinction is of great importance under the Administrative Procedure Act (APA). A legislative or substantive rule passes through the rulemaking process as a notice and comment, has the force and effect of law, and is binding on both the agency and the regulated parties.”
The interpretive rule is exempt from notice and comment requirements, has no force of law, and merely clarifies how the agency understands existing statutory provisions,” he continued.
The interpretive rule does not legally bind courts to enforce the rules, which gives the SEC and the crypto industry flexibility to adapt to future regulatory changes, he added.
Thorn Said: New Regulatory Approach Provides Crypto Industry Much-Needed Clarity for Next 30 Months; however, he explained that the CLARITY Cryptocurrency Market Structure Act must be codified into law to solidify the rules for the next several decades.
Related: SEC’s interpretation of cryptocurrency regulation ‘beginning, not end’, says Atkins
The CLARITY Act is stalled, but there are rumors of a tentative agreement between the White House and lawmakers
The CLARITY Act stalled in January 2025 after cryptocurrency exchange Coinbase and other industry players raised concerns about the stablecoin ban and lack of protections for open source software developers.
Crypto companies and industry leaders also cited regulations that would effectively destroy the decentralized finance (DeFi) industry by imposing know-your-customer reporting and auditing requirements on DeFi as a major cause of contention.
On Friday, “Politico” published, among others: report a preliminary agreement between the White House and lawmakers to accelerate work on the CLARITY Act.
Specific details of the potential deal have not yet been released, although Senator Angela Alsoboorks has stated that the tentative agreement includes a ban on stablecoin yields from “passive balances.”
Warehouse: How cryptocurrency regulations have changed in 2025 – and how they will change in 2026
