SEC Leadership Shortage Could Accelerate Crypto Rulemaking

With Congress failing to pass a comprehensive digital asset market structure bill, financial regulators are stepping up efforts to reshape crypto oversight—and a thinning bench of agency leaders may make it easier to get rules across the finish line. Both the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) are severely understaffed at the leadership level, leaving decisions over regulating aspects of the $3 trillion crypto market in the hands of just three confirmed officials, two of whom were nominated by US President Donald Trump.

The staffing shortfall is significant. At the SEC, only Chair Paul Atkins and former Acting Chair Mark Uyeda remain following the recent departure of Commissioner Hester Peirce. The CFTC is even more thinly staffed, with Michael Selig serving as its sole Senate-confirmed chair and commissioner since December 2025. Both agencies are statutorily required to have five commissioners, yet both have already proposed rules that appear to fill the legislative gap. In August, the SEC introduced rules offering companies a safe harbor from having tokens treated as "investment contracts," and the CFTC followed suit in October, with Selig stating the agency would use its "existing statutory authorities" to address exchange regulation. On Oct. 2, Atkins confirmed that "more regulatory proposals [were] on the horizon."

A procedural change at the SEC has further lowered the threshold for action. On Sept. 30, the agency released a final rule—effective Oct. 2—that amended quorum requirements to "promote flexibility and finality of agency rulemaking." Under the new framework, only one commissioner is required for a quorum in many cases when only two are present, raising the possibility that a single official could formally approve rules affecting America's multitrillion-dollar securities markets. As Financial Times columnist Robin Wigglesworth noted on Oct. 5, "with now just two commissioners around and it being entirely possible that one of them might have to recuse themselves from an issue (or be otherwise MIA), just one is now enough to pass a formal rule."

The implications for the crypto industry are substantial. With a market structure bill stalled in Congress, the SEC and CFTC appear poised to set de facto policy through administrative rulemaking—potentially defining what constitutes a security, how exchanges operate, and what safe harbors exist for token issuers. Uyeda responded to criticism of the quorum change in a Sunday Financial Times op-ed, signaling the agency is prepared to defend its expanded procedural latitude. For crypto companies and investors, the next several months may see regulatory ground rules shaped not by legislation, but by a handful of agency officials operating with unprecedented unilateral authority.