US regulators step up oversight of crypto assets and prediction markets...submit guidelines to the White House

US regulators are accelerating efforts to advance new supervisory measures for virtual assets (cryptocurrencies) and prediction markets.

According to Bloomberg on the 5th (local time), the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) recently submitted related regulatory plans to the White House. While the details have not yet been disclosed, the move is being seen as one of the most meaningful administrative steps taken by market regulators since the launch of the Donald Trump administration.

According to the website of the White House Office of Information and Regulatory Affairs (OIRA), the SEC submitted to OIRA last Tuesday commission-level guidance on virtual-asset regulation. The agenda covers the "application of federal securities laws to certain types of virtual assets and related transactions."

A spokesperson for SEC Chair Paul Atkins said in connection with this that "to help investors and innovators clearly understand their regulatory obligations, we will review interpretive guidance related to a 'token classification framework' for virtual assets, in step with market-structure legislation."

Once a token classification framework is established, various virtual assets could be divided into official categories—for example, clearly distinguishing whether a particular token is a security overseen by the SEC or a commodity under the CFTC’s jurisdiction. Such classifications would have a material impact across crypto firms’ businesses, including registration, disclosures and operating practices. Because commission-level guidance requires a commission vote, it carries stronger force than statements issued by staff. However, it is one step below the full-fledged process of adopting formal rules that involves advance public notice and comment.

Work to bring prediction markets—also rapidly expanding into a multibillion-dollar sector alongside virtual assets—into the regulatory mainstream is also gaining pace. Prediction markets, where money is wagered on outcomes of political and sports events, have drawn intense interest in Washington recently as contracts tied to Middle East conflicts have emerged.

In this connection, the CFTC also submitted measures related to prediction markets to the White House on the 2nd and is undergoing OIRA review. CFTC Commissioner Michael Selig said the measures have shifted to the stage of an "advance notice of proposed rulemaking," which publicly lays out concepts ahead of formal rulemaking.

In the past, independent regulators such as the SEC and CFTC were not required to submit new rules to the White House. But the Trump administration changed guidance last year to require all executive-branch agencies and financial regulators to undergo White House pre-review when making rules. As a result, the proposals submitted this time are expected to become the official rules for the crypto industry under the Trump administration going forward.