Can The SEC and CFTC’s Pro-Crypto Rules Be Overturned? Legal Opinion
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Written by Andrew Fenton, staff editor
Edited by Felix Ng, staff editor
Can the SEC and CFTC’s pro-crypto rules be overturned? Legal opinion
Magazine
Published Oct 15, 2026
The SEC and the CFTC have recently issued a wave of pro-crypto rules. But can these rules hold up in court, and are they easily reversible by the "anti-crypto army"?
In the wake of the failed CLARITY cloture vote in the Senate, the SEC and CFTC swiftly introduced their own crypto market regulations.
Just two days after the vote, the SEC announced a five-year exemption for the issuance and trading of stock tokens, leading to partnerships like OXK with ICE and Securitize launching tokens for companies like Apple, Nvidia, and Microsoft.
The SEC also provided clarifications on crypto tokens, stating that mere token buybacks do not automatically convert them into securities, and proposed new rules for crypto asset custody.
Meanwhile, the CFTC proposed a new "crypto asset market" registration category and plans to allow registered exchanges to offer leveraged trading.
However, concerns persist that these rules may be tenuously grounded. TD Cowen has noted that agency rules are particularly vulnerable to rescission, as demonstrated by the Trump-appointed commissioners' rollback of Gary Gensler's era regulations.
A 2024 Supreme Court decision further weakens agency rulemaking, making it susceptible to court challenges. This is currently being tested in a lawsuit by a community bank group against the OCC for granting crypto firms national trust bank charters.
To delve into the legal complexities, Magazine spoke with Yuriy Brisov from D&A Partners. This is an edited version of their conversation.
Magazine: Did SEC Chair Paul Atkins' statement after the CLARITY vote failure, claiming the agency was releasing rules because Congress didn't, set a dangerous precedent? Are agencies like the SEC meant to create rules, or just interpret existing ones?
Brisov:
They are meant to create rules. The SEC has this power under the Exchange Act of 1934. Its establishment arose from the 1929 market crash, and its role is to oversee laws and create frameworks for emerging technologies like blockchain tokens. This is a continuous process, and the Commission has been exercising this power for decades.
Magazine:
Could a future SEC, appointed under a different administration, interpret these rules differently?
Brisov:
There should be a justification for such a change. They can, in theory, do so, but it should align with the existing legal framework. Under Gary Gensler, the Commission tried to apply these rules to tokens, but it failed due to vagueness, leading many companies to leave the US market.
This presents an opportunity for the new Commission to refine and clarify these rules.