1inch Lawyer: US Crypto Regulation Shaped by Agencies as Midterms Near

As the US midterm elections unfold, crypto regulators and lawmakers remain locked in the same tension: agencies are increasingly shaping day-to-day compliance, while legislation that could provide long-term certainty—most notably the stalled CLARITY Act—still cannot break through. Speaking in the context of the election’s potential to shift Congress, Maylea Ma, deputy general counsel at 1inch, said the most meaningful regulatory momentum in the next few years is likely to come from federal agencies rather than Congress.

Ma argued that engagement between regulators and crypto firms is growing, but agency guidance alone may not deliver the stability institutions have been seeking. D3 co-founder Michael Ho, whose team builds Doma Protocol, echoed that concern, pointing to how policy that depends on the tenure of a future administration can deter serious capital.

Key takeaways

• 1inch’s deputy general counsel expects federal agencies to drive the next phase of US crypto regulation more than Congress, even as the midterms could reshape priorities.
• Industry leaders warn that agency guidance may remain reversible with political change, making it harder for institutions to commit.
• SEC action on crypto fundraising and related staff guidance continues to define compliance expectations for token issuers and network participants.
• The CFTC has submitted a crypto market regulatory plan to the White House, underscoring continued administrative work despite the CLARITY Act stalling.
• Both executives linked lasting institutional adoption—including tokenized real-world assets—to rules anchored in legislation rather than shifting guidance.

Congress may shift, but agency rulemaking is the near-term lever

Ma framed the broader regulatory picture as one where election outcomes could affect what happens in Congress, including the future of the CLARITY Act. However, she suggested that the pace and substance of regulation in the near term will be determined primarily by federal agencies.

Her emphasis reflects a reality traders and builders know well: even when Congress is slow, regulators can still influence markets through proposals, enforcement posture, and staff interpretations. In Ma’s view, this pattern is likely to persist until clearer statutory guardrails exist.

At the heart of the concern is permanence. Ma stressed that the “long-term goal” remains a statute that is not repeatedly re-litigated when administrations change, implying that the industry is looking for guardrails that survive political cycles rather than documents that can be rewritten or deprioritized.

Why policy stability matters for institutional capital

Ho’s comments focused less on what regulators are doing today and more on what investors are willing to do tomorrow. According to Ho, the stalled market structure effort means US crypto policy continues to rely heavily on agency guidance—guidance he characterized as vulnerable to reversal under a future administration.

Ho’s practical point was that this uncertainty keeps “serious capital waiting.” In other words, institutional allocation decisions often depend on predictable legal treatment. When compliance frameworks can shift, risk models become harder to validate and governance processes become more conservative, particularly for capital that must justify regulatory exposure internally.

Ho further linked clearer rules to adoption outcomes beyond pure crypto trading: he argued that “clear rules written into law” are what will unlock institutional capital in tokenized real-world assets—areas where legal, custody, and investor-protection questions tend to be especially sensitive.

SEC proposals and staff updates continue to shape token issuance and network compliance

Recent SEC activity referenced in the discussion suggests agencies are not waiting for congressional action to advance. In August, the SEC proposed a framework for crypto fundraising. The proposal included potential exemptions for certain token offerings and a safe harbor intended to reduce the risk of tokens being treated as investment contracts.

Then in September, the SEC updated staff guidance covering multiple areas relevant to market participants, including token buybacks, crypto networks, and staking receipt tokens.

For investors and protocol teams, these are not abstract policy signals. They influence how issuers document rights, how networks structure participation, and how staking-related products are described and managed. While proposals and staff guidance do not carry the same weight as a statute passed by Congress, they often become the de facto compliance map in the absence of legislative clarity.

The key issue, as Ma and Ho both imply, is durability: even if agency interpretation is workable today, institutions prefer rules embedded in legislation because they are harder to overturn quickly.

CFTC work continues in parallel as CLARITY Act efforts stall

Alongside the SEC’s fundraising and guidance efforts, the CFTC is also advancing its own regulatory planning. The discussion notes that on Sept. 17, the CFTC submitted a crypto market regulatory plan for White House review—timed closely to congressional momentum fading.

Indeed, the CFTC action was referenced as coming two days after the Senate failed to advance the CLARITY Act. That juxtaposition highlights the core dynamic under debate: while legislative movement can stall, regulatory agencies continue working through administrative channels.

For market participants, the practical takeaway is that governance and compliance expectations may continue tightening regardless of congressional outcomes. Even without the CLARITY Act, proposals, staff guidance, and inter-agency planning can still shift how products are structured and how exchanges and intermediaries manage risk.

Election outcomes may change emphasis, not the direction of travel

The midterms could alter which committees and lawmakers prioritize crypto policy, which in turn could affect whether the CLARITY Act gains traction. But Ma’s view suggests that even a shift in Congress may not immediately change the regulatory operating system: agencies are increasingly engaging with projects and shaping interpretation.

What remains uncertain is the degree of stability institutions can count on. Ho’s warning underscores the asymmetry between day-to-day enforcement and long-term rulemaking: investors may be comfortable navigating agency guidance once they understand it, but they may hesitate to commit large sums if they believe the guidance could be replaced after a political transition.

As the election results settle and the next wave of SEC and CFTC activity unfolds, market participants will want to watch whether regulatory plans translate into more durable, legislatively anchored frameworks—or whether the industry remains dependent on guidance that can be redirected with each administration.