An Opinion Piece by Andrew M. Cuomo, former Governor of New York
The Digital Asset Landscape: A Call for Concrete Regulations
The digital asset revolution has significantly impacted the financial system, shifting the landscape of how transactions and investments are conducted.
As this transformation solidifies, the pressing question emerges: Will the United States establish a cohesive and sustainable regulatory framework to guide this evolution? Currently, the answer appears to be negative.
The Role of the CLARITY Act
The CLARITY Act was designed to address the need for a definitive national guideline regarding digital assets. It aimed to clarify the responsibilities of federal entities such as the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), thus ensuring that businesses and investors face a transparent regulatory environment.
Despite the House’s approval of the CLARITY Act in 2025, the legislation has not progressed to the President for signing, as the Senate stalled its advancement in September. This stagnation raises concerns about what the future holds for digital assets.
Responses from Federal Agencies
In the void left by Congressional inaction, federal agencies have adopted aggressive regulatory measures that thoroughly reshape the market dynamics. The SEC and CFTC have proposed new frameworks for crypto trading platforms and devised specific regulations tailored to certain digital assets.
While this swift action may offer immediate market opportunities, it is essential to recognize that these newly formed rules lack the stability of a comprehensive law and are based on the existing authority of agencies. Such regulations are inherently vulnerable to political shifts, particularly given their introduction amidst congressional dissent.
The Political Landscape’s Influence
Looking ahead, potential changes in congressional control could disrupt the regulatory framework that has been established. Current electoral forecasts suggest a 64% chance that Democrats will take majority control in the Senate following the midterms. This shift raises the possibility of legislative changes that challenge current agency actions.
During my tenure in the Clinton administration, I witnessed firsthand how a change in congressional power significantly impacted agency directives. In 1994, the midterm elections resulted in a Republican majority, which severely curtailed the operational capacity of the Department of Housing and Urban Development.
This historical precedent highlights how Congress may respond to perceived overreach by agencies, particularly as the Democrats aim to substantiate claims regarding alleged misconduct during the Trump administration. Regardless of the veracity of these claims, the political narrative shapes oversight dynamics.
Congress’s Oversight Tools and Responsibilities
The legislature possesses ample tools to influence agency actions, including:
- Reviewing and approving new rules before they take effect
- Restricting agency funding
- Passing legislation to override agency regulations
- Utilizing the Congressional Review Act to annul specific rules
- Initiating investigations and hearings with subpoena power
Given the array of oversight options, Congress holds considerable sway over regulatory outcomes, which underscores the need for stability in the framework governing digital assets.
The Need for Bipartisan Legislation
The fundamental issue lies in aligning private-sector technological advancements with sensible governmental oversight. The absence of the CLARITY Act has led to a climate of uncertainty—a situation detrimental to businesses, consumers, and legislators alike.
Firms should not be left guessing about the continuity of the rules that impact their operations. Instead, there must be a clear understanding of legal boundaries, regulatory authorities, and enforcement procedures.
The United States deserves a regulatory environment that fosters innovation while safeguarding investors and consumers. It needs mechanisms to deter malpractice and maintain market integrity, ensuring companies have a solid foundation for their investments and operations.
Comparative Global Approaches
Internationally, other nations are establishing robust regulatory frameworks for digital assets, such as the European Union’s Markets in Crypto Assets (MiCA) regulation and Singapore’s Payment Services Act. These initiatives provide necessary regulatory certainty crucial for sustaining financial innovation.
A Call to Action
As we move forward, it is vital for the next Congress to set aside partisan divisions and prioritize bipartisan efforts to enact legislation that authorizes and regulates digital asset activities effectively. This collaborative approach will enable companies to invest with confidence in the United States.
About the Author
Andrew M. Cuomo served as the Governor of New York from 2011 to 2021, previously holding roles as the New York Attorney General and as the U.S. Secretary of Housing and Urban Development. He is currently on the board of OKX and co-chairs OKXICE, a joint venture between OKX and the Intercontinental Exchange focused on tokenized and digitally native financial products.
