Catenaa, Thursday, September 03, 2026-The proposed CLARITY Act would establish clearer boundaries between US financial regulators overseeing digital assets, but it would leave much of the industry’s underlying operational infrastructure unchanged.
The legislation sets out responsibilities for the Commodity Futures Trading Commission and Securities and Exchange Commission while establishing registration, custody and recordkeeping requirements.
It does not prescribe how financial firms should modernize fragmented databases, automate reconciliation or replace manual processes supporting digital asset businesses.
That distinction could become increasingly important if clearer regulation encourages traditional financial institutions to expand into crypto markets.
Under Section 401, the CFTC would receive exclusive regulatory jurisdiction over cash or spot transactions involving digital commodities conducted through entities required to register as digital commodity exchanges, brokers or dealers.
The legislation would also establish an expedited registration process for qualifying firms.
That would give crypto trading platforms a more clearly defined federal regulatory route than the fragmented approach under which many currently operate.
The structure seeks to answer one of the longest-running questions in US crypto regulation: which agency supervises digital assets that are not securities?
The CFTC already oversees commodity derivatives but has historically possessed more limited authority over spot commodity markets.
The CLARITY Act would expand its role for designated digital commodities.
The SEC would continue to exercise authority in areas involving securities and SEC-registered entities.
It would also retain anti-fraud and anti-manipulation powers over certain transactions involving permitted payment stablecoins and digital commodities occurring through SEC-regulated firms.
The legislation therefore does not create a clean institutional separation in which every digital asset falls exclusively under one regulator.
Some companies could continue interacting with both agencies depending on their activities and registrations.
Section 304 attempts to address that overlap.
SEC registrants that are also registered with the CFTC as digital commodity exchanges, brokers or dealers would be required to establish conflict-of-interest policies.
The SEC and CFTC would also be required to enter into a memorandum of understanding supporting information sharing and limiting unnecessary duplication.
Clearer agency jurisdiction would solve only part of the problem facing financial institutions entering digital assets.
A separate study by financial operations company AutoRek suggests many firms are struggling with the infrastructure needed to process growing transaction volumes and additional asset classes.
The research surveyed 250 senior operations, finance and technology executives in the United States and United Kingdom.
About 85% expected existing operating systems to face scalability pressure as transaction activity grows.
Among firms already handling digital assets, 59% said the asset class creates disproportionately high operational complexity compared with other markets.
Those problems exist regardless of whether the SEC or CFTC has jurisdiction.
Data integration was identified as the largest operational challenge by 41% of respondents.
Crypto transactions can involve exchanges, custodians, blockchain networks, internal accounting systems and traditional banking infrastructure.
Each system may record transactions differently.
A financial institution must then reconcile those records to determine positions, customer balances, fees and settlement obligations.
When systems do not communicate cleanly, staff may resort to spreadsheets and manual intervention.
AutoRek found firms were losing an estimated 15.9% of operational budgets to rework associated with manual processes and spreadsheets.
Regulatory clarity does little by itself to remove those costs.
Artificial intelligence has begun entering financial operations, but deployment remains fragmented.
The AutoRek survey found 98% of firms were using AI somewhere within their operations.
Only 14%, however, had integrated the technology fully across their operating systems.
That gap suggests companies are experimenting with AI tools without fundamentally redesigning the infrastructure supporting their businesses.
Crypto could increase pressure for such modernization because digital assets trade continuously and can settle outside traditional banking hours.
Legacy financial systems built around business-day processing may struggle with assets operating around the clock.
The CLARITY Act does address some infrastructure issues directly.
Section 305 would allow brokers, dealers, transfer agents, investment advisers, investment companies and national securities exchanges to use blockchain records to meet existing recordkeeping requirements.
The SEC would be required to develop implementing rules within 180 days after enactment.
That provision could reduce barriers preventing financial institutions from treating blockchain records as part of their formal books and records.
It could also encourage greater use of distributed ledgers within regulated financial systems.
But accepting blockchain records does not automatically connect those records with accounting, risk and compliance systems.
Companies would still need technology capable of reconciling blockchain activity with internal databases.
The legislation also includes specific requirements covering custody.
Section 402 would require futures commission merchants handling customer digital assets to use qualified digital asset custodians.
Other provisions address recordkeeping and the treatment of customer assets.
Custody has been one of the major operational questions confronting institutions entering crypto markets.
Traditional securities are generally held through established custody and clearing systems.
Digital assets introduce private keys, blockchain settlement and other technical requirements that differ substantially from conventional financial infrastructure.
Setting regulatory requirements could clarify who may hold assets.
It would not determine how institutions integrate those custodians into their internal operating systems.
Those operational questions could become more pressing if the CLARITY Act encourages banks, brokers and asset managers to expand their digital asset businesses.
Large financial institutions are already exploring stablecoins, tokenized deposits and blockchain-based securities.
Clearer regulatory boundaries could accelerate those projects.
That would increase transaction volumes passing between traditional financial systems and blockchain networks.
The companies most prepared operationally may therefore gain an advantage even if their competitors operate under identical regulations.
Compliance could become only one part of the challenge.
Processing transactions efficiently may become equally important.
The CLARITY Act addresses the legal structure of the market.
It defines regulatory categories, assigns oversight responsibilities and establishes rules for registered intermediaries.
It does not redesign the technology used by banks, exchanges or asset managers.
That work remains with the firms themselves.
The distinction matters because regulatory uncertainty has often been presented as the primary obstacle preventing institutional crypto adoption.
Removing that uncertainty may expose a second problem.
Many financial companies still operate systems built for conventional markets rather than blockchain-based assets trading continuously across multiple platforms.
Passing market structure legislation could therefore mark the beginning of another stage rather than the end of the transition.
The SEC and CFTC may eventually have clearer boundaries.
Financial institutions would still need to build the infrastructure capable of operating inside them.
