CFTC crypto rulemaking faces 2028 deadline risk, TD Cowen says

Traders Union
All News
Crypto
CFTC crypto rulemaking risk

Highlights

TD Cowen's Jaret Seiberg estimates the CFTC may not finalize its crypto platform rulemaking until early 2028, risking derailment by the election cycle.
The CFTC's proposal would mandate proof-of-reserves audits for crypto platforms and extend federal authority over state-licensed entities, but avoids spot market oversight.
Failure of Senate legislation means CFTC and SEC regulation relies on non-permanent agency action, with Seiberg warning both fast and slow rulemaking risk extended court challenges.

Rulemaking timeline and regulatory scope

As reported by The Block, TD Cowen managing director Jaret Seiberg says the Commodity Futures Trading Commission's advance notice of proposed rulemaking, released a week ago, is a constructive step for crypto platforms but is unlikely to be completed quickly. He says the agency at best gets a formal proposal out in late Q1 2027 or early Q2 2027, with finalization potentially not coming until early 2028.

Seiberg says that schedule increases the risk the rule never becomes final as the 2028 election cycle approaches. He adds that time is running out for the current administration to lock in a durable framework for the sector.

Last week, the CFTC proposed a federal framework for crypto platforms while avoiding direct jurisdiction over spot market transactions. Seiberg says the plan would require platforms to maintain proof-of-reserves audits and would give the agency authority over state-licensed platforms.

Industry impact and legal risks

After the Senate fails in an initial vote to pass broad crypto legislation that would have granted the CFTC sweeping authority over spot crypto trading, both the CFTC and the Securities and Exchange Commission step in to regulate the industry. That includes use of a long-awaited innovation exemption, but Seiberg says agency action lacks the permanence that legislation would have provided.

He says a faster timetable could create a different problem for the regulator. In his view, expediting the process raises the chance that a court blocks the rule on procedural grounds, and legal challenges could extend beyond 2028 even if the agency moves carefully.

The Altura frozen-funds dispute highlighted how crypto yield platforms can unravel after a liquidity shock, leaving depositors unable to withdraw and pushing them toward fraud complaints and court action in the UK. Our earlier coverage described Altura’s withdrawal halt, claims of a frozen bank account, and the legal steps taken by users to document losses and pursue recovery—underscoring the need for clearer safeguards around reserves, disclosures, and platform accountability.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.