Senator Cynthia Lummis sat down with CFTC Chairman Michael S. Selig on March 5–6 to hash out a path forward for the Digital Asset Market Clarity Act of 2025 - legislation that would draw a long-contested line between federal regulators' authority over digital assets.

Key Takeaways

• Sen. Lummis and CFTC Chairman Selig met to push the CLARITY Act toward a Senate vote

• The bill would split crypto oversight: CFTC handles digital commodities, SEC handles tokenized securities

• Prediction markets put passage odds at 50–85% before June 2026; Ripple’s CEO forecasts 80–90% by late April

• The CFTC is also moving to allow regulated perpetual futures in the U.S. for the first time

Both sides left the two-day meeting pledging to “get the bill across the finish line.” Selig, for his part, acknowledged what he called the “urgency of this moment” – a notable departure from the enforcement-first posture that defined the prior administration’s approach to crypto oversight.

The discussion centered on establishing a workable “token taxonomy” – a definitional framework to separate digital commodities from securities. It’s a distinction that has fueled years of regulatory conflict between the CFTC and SEC, and one the industry has been lobbying to resolve through legislation rather than litigation.

What the Bill Actually Does

Under the CLARITY Act’s framework, the CFTC would take exclusive jurisdiction over digital commodities – Bitcoin and Ethereum chief among them – on blockchains deemed sufficiently mature. The SEC would retain authority over tokenized securities and early-stage capital raises.

Great meeting with CFTC Chairman Michael Selig to discuss digital asset market structure. @ChairmanSelig understands the urgency of this moment, and I look forward to continued collaboration as we work to integrate digital assets into the 21st century financial system. pic.twitter.com/Pc68izvqlK

— Senator Cynthia Lummis (@SenLummis) March 5, 2026

The maturity threshold matters. A project qualifies once it is functional, open-source, and decentralized – with no single entity controlling more than 20% of the token supply. Once certified, oversight shifts from the SEC to the CFTC.

Lummis is also pressing a separate but related provision: a $300 de minimis tax exemption on small crypto transactions, targeting everyday use cases like retail purchases. It’s a practical concession to Bitcoin’s limitations as a spending currency under current tax law, where even buying a cup of coffee can technically trigger a taxable event.

Where the Bill Stands

The House passed the legislation last July with a 294–134 vote – broader support than many expected. The Senate has been another story.

Prediction markets have reflected the uncertainty. Platforms like Kalshi and Polymarket briefly pushed passage odds as high as 85% before June 2026, but those figures have since retreated to somewhere in the 50–70% range following fresh delays. Ripple CEO Brad Garlinghouse has been more bullish, putting the odds at 80–90% by late April, citing what he describes as renewed momentum in Washington.

President Trump has added political pressure from the top, publicly calling for passage and accusing banks of working to undermine the crypto agenda to protect their own margins.

Broader Regulatory Moves

The Lummis-Selig meeting sits within a wider push to modernize federal crypto oversight. The CFTC and SEC are running a joint initiative – dubbed Project Crypto – to harmonize standards across agencies and present a unified federal approach to digital asset regulation.

Selig separately announced that the CFTC is updating its rules to permit regulated perpetual futures to trade domestically – a move aimed at pulling liquidity back from offshore exchanges that have dominated that market.

The CLARITY Act also contains a DeFi carve-out that would exempt activities like transaction validation and software development from being classified as financial intermediation – a provision that has drawn significant interest from developers and protocol operators watching how far the regulatory perimeter extends.