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The U.S. crypto sector has a problem. A big one. Without bipartisan legislation locked in place, every rule written by a federal agency is basically one election away from being torn up.
Why It Matters
The stalled progress of the CLARITY Act underscores the ongoing uncertainty faced by U.S. crypto businesses, which could hinder innovation and investment in the sector. Without a clear regulatory framework, companies may struggle to navigate a patchwork of rules that can change with political shifts, potentially stifling growth and driving businesses to more crypto-friendly jurisdictions. This regulatory limbo not only affects domestic players but also raises concerns about the U.S.'s competitiveness in the global digital asset market.
Former New York Governor Andrew Cuomo has been pretty direct about it: Congress needs to pass solid, bipartisan legislation or the digital asset industry will keep operating in a fog. The CLARITY Act, designed to create a national framework for crypto, cleared the House in 2025. Then it hit the Senate. And it’s been stuck there since.
What the CLARITY Act Was Supposed to Fix
The bill’s whole point was to draw clear lines between the SEC and the CFTC — who regulates what, and under what conditions. Without it, both agencies have pushed ahead with their own rules covering crypto trading platforms and certain digital assets. It’s not nothing. But agency-written rules don’t carry the same weight as law. They can be challenged, defunded, or reversed when the political winds change. That’s the core issue Cuomo keeps coming back to.
And the winds are shifting. With midterm elections in the picture, Democrats could end up controlling one or both chambers of Congress. If that happens, the current regulatory setup — built largely under a framework that Democrats have already called politically motivated — could face serious pushback. Cuomo points to the Clinton administration’s experience after the 1994 midterms as a reference point. Congress moved hard against executive agency actions then. It can happen again.
There’s real teeth behind that threat. Lawmakers can use the Congressional Review Act to roll back agency rules. They can cut agency funding. They can hold hearings that drag on long enough to freeze enforcement. None of that requires a new law — it just requires enough votes and enough political will. And depending on who controls the next Congress, that will could go either direction.
How the U.S. Compares to Europe and Singapore
Meanwhile, other parts of the world aren’t waiting. Europe has MiCA — the Markets in Crypto-Assets regulation — giving businesses a clear rulebook across member states. Singapore has its Payment Services Act. Both frameworks tell companies what they can do, what they can’t, and who they answer to. It’s not perfect, but it’s predictable. And predictability is what businesses need when they’re deciding where to hire, where to incorporate, and where to build.
The U.S. doesn’t have that right now. Cuomo’s argument is pretty straightforward: regulatory ambiguity doesn’t just frustrate lawyers, it costs jobs and investment. Companies that can’t get a clear answer on compliance will eventually stop asking and just set up shop somewhere else. That’s not hypothetical. It’s already a conversation happening in boardrooms.
Not yet a crisis, maybe. But close.
Cuomo has been pushing the idea that the next Congress needs to treat a stable crypto framework as a priority — not a partisan football. The problem is that crypto regulation has become exactly that. Democrats have viewed some of the current agency-driven rules as products of a specific political moment rather than sound policy. Republicans, for their part, have generally pushed for lighter oversight. Getting both sides to agree on something durable is hard. It’s been hard for years.
Businesses Caught in the Middle
For companies operating in the U.S. crypto market right now, the uncertainty is real and it’s daily. Do you build a compliance program around SEC guidance that might get reversed? Do you structure a product around CFTC rules that could look completely different in 18 months? There’s no clean answer. Cuomo’s position is that without the CLARITY Act or something like it, businesses can’t make those calls with any confidence.
And it’s not just the companies themselves. Investors, consumers, and anyone with exposure to digital assets in the U.S. faces the same murky environment. The regulatory floor keeps shifting.
The irony is that the agencies stepped in precisely because Congress didn’t act. The SEC and CFTC filling the vacuum was a response to inaction, not a plan. And now that stopgap has become the de facto framework — fragile, contested, and tied to whoever holds power at any given moment.
Cuomo’s broader point is that technological change has outrun the legislative process. That’s not a new problem. But crypto moves faster than most sectors, and the gap between what’s happening in the market and what the law actually says has gotten wide enough to cause real damage.
The CLARITY Act is still sitting in the Senate.
Frequently Asked Questions
What is the CLARITY Act and what happened to it?
The CLARITY Act was a bill designed to create a national regulatory framework for digital assets in the U.S., clarifying the roles of the SEC and CFTC. It passed the House in 2025 but has stalled in the Senate.
Why does Andrew Cuomo say bipartisan legislation matters for crypto?
Cuomo argues that agency-driven rules from the SEC and CFTC can be reversed with shifts in congressional control, making them unreliable. Only bipartisan legislation, he says, can give businesses and investors the stable, predictable environment they need.
