SEC and CFTC Sign Memorandum to Coordinate Crypto Regulation, Ending Decades of Turf Wars

The U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission have signed a memorandum of understanding committing to closer coordination on oversight of financial markets, including the development of a “fit-for-purpose regulatory framework for crypto assets.”

The March 11, 2026 agreement aims to end decades of “regulatory turf wars” between the agencies by adopting a “minimum effective dose” strategy to foster innovation while maintaining market integrity and U.S. global competitiveness.

Memorandum of Understanding: Key Provisions

Regulatory Coordination Mandate

The memorandum acknowledges that “new trading models, digital infrastructure, and onchain, automated systems increasingly blur traditional jurisdictional lines” as market participants operate across platforms and asset classes. The agencies commit to sharing information and data concerning issues of “common regulatory interest” to fulfill their respective mandates.

This coordination is designed to provide regulatory clarity and certainty built on technology-neutral regulations, addressing the long-standing challenge where overlapping jurisdiction created uncertainty for market participants operating in the digital asset space.

Ending Regulatory Turf Wars

SEC Chairman Paul Atkins stated that “for decades, regulatory turf wars, duplicative agency registrations, and different sets of regulations between the SEC and CFTC have stifled innovation and pushed market participants to other jurisdictions.” The memorandum represents what Atkins described as the latest step toward repairing the relationship between the agencies.

CFTC Chairman Michael Selig emphasized that “America’s financial markets are the envy of the world because they scale and adapt to meet investor demands. Like our markets, the CFTC’s and SEC’s regulatory frameworks must also evolve and modernize to accommodate the needs of our market participants.”

“Minimum Effective Dose” Regulatory Philosophy

Innovation-Focused Approach

The two agencies said they plan to adopt a “minimum effective dose” regulatory strategy—a pharmacological term defined as the smallest dose of medication that produces the desired therapeutic benefit. Applied to regulation, this approach aims to foster innovation while maintaining market integrity and keeping the U.S. competitive globally.

This philosophy represents a shift from prescriptive, heavy-handed regulation toward targeted oversight that addresses specific risks without unduly burdening innovation.

Fit-for-Purpose Framework for Crypto

The memorandum specifically commits the agencies to working on federal policy that provides a “fit-for-purpose regulatory framework for crypto assets and other emerging technologies.” This includes closely coordinating and cooperating to remove obstacles where appropriate to the lawful introduction of crypto asset products.

The regulatory clarity will be provided to market participants operating across trading platforms, clearinghouses, data repositories, pooled investment vehicles, dealers, and intermediaries, as well as for products that span securities and derivatives frameworks.

Implementation and Enforcement

Information Sharing

The agencies commit to sharing information and data concerning issues of common regulatory interest to fulfill their respective regulatory mandates. This collaborative approach is designed to prevent regulatory gaps and ensure comprehensive oversight of increasingly complex financial markets.

Scope of Coordination

The agreement covers oversight of market participants operating across everything from trading platforms, clearinghouses, and data repositories to pooled investment vehicles, dealers, and intermediaries. It also addresses products that span both securities and derivatives frameworks, which have historically been sources of jurisdictional ambiguity.

Policy Context and Administration Goals

Crypto Capital of the World

Both the SEC and CFTC have made strides to deliver on President Donald Trump’s mission of making the United States the “crypto capital of the world.” The agencies have established crypto-specific task forces and advisory committees to ensure that crypto, artificial intelligence, and other emerging technology innovations continue to advance in the U.S.

Evolving Regulatory Landscape

The memorandum comes as the Trump administration has taken multiple steps to reshape U.S. crypto policy, including the passage of the GENIUS Act establishing federal standards for stablecoins, efforts to provide clearer tax treatment for digital assets, and ongoing legislative debates over the CLARITY Act market structure bill.

While memoranda of understanding are generally non-binding, the formal expression of intent to work closely together on policy measures including crypto is widely viewed as a positive signal for digital asset advocates seeking regulatory clarity.

FAQ: SEC-CFTC Crypto Coordination

Q: What does the SEC-CFTC memorandum mean for crypto regulation?

A: The agreement commits the agencies to coordinate oversight and develop a “fit-for-purpose regulatory framework for crypto assets.” This aims to eliminate jurisdictional ambiguity and provide clearer rules for market participants operating across securities and derivatives frameworks.

Q: What is the “minimum effective dose” regulatory strategy?

A: Borrowed from pharmacology, the term refers to applying the smallest regulatory intervention necessary to achieve the desired protective outcome. The agencies intend to use this approach to foster innovation while maintaining market integrity and U.S. global competitiveness.

Q: How does this memorandum address past regulatory conflicts?

A: SEC Chairman Paul Atkins noted that “regulatory turf wars, duplicative agency registrations, and different sets of regulations” have historically stifled innovation and pushed market participants overseas. The agreement commits the agencies to share information and coordinate on issues of common interest to prevent such conflicts.

Q: What crypto-specific initiatives are included in the agreement?

A: The memorandum specifically commits the agencies to working on federal policy for crypto assets, closely coordinating on the lawful introduction of crypto asset products, and providing regulatory clarity for market participants across the digital asset ecosystem.