According to Fixygen, Democrats in the U.S. House of Representatives are discussing the drafting of a new bill to regulate the cryptocurrency market, which may include expanding the powers of the Securities and Exchange Commission (SEC), limiting the role of the Commodity Futures Trading Commission (CFTC), and imposing additional requirements to prevent conflicts of interest among federal officials.
This was reported on November 4, 2026, by journalist Eleanor Terrett, citing three sources in the cryptocurrency industry who had been in contact with representatives of the Democratic Party.
According to her, Democrats are considering using the Crypto Investor and Consumer Bill of Rights—an initiative proposed by Congresswoman Maxine Waters in 2025 during the consideration of the Digital Asset Market Clarity Act (CLARITY Act)—as the basis for a new bill.
The bill may include provisions that Democrats previously proposed as amendments to the CLARITY Act but which were not adopted by the House of Representatives. The possibility of incorporating provisions previously agreed upon during negotiations between Democrats and Republicans in the Senate is also being considered.
One of the key differences in the new bill could be the redistribution of authority between the SEC and the CFTC.
The Republican regulatory model outlined in the CLARITY Act called for giving the CFTC a leading role in overseeing the digital asset market, particularly the activities of cryptocurrency exchanges, brokers, and dealers.
At the same time, the SEC would retain authority over digital assets subject to securities laws and certain token transactions.
According to Terrett, Democrats are considering the opposite approach, under which the SEC would have broader authority to oversee the cryptocurrency market, while the CFTC’s jurisdiction would be more limited.
The specific division of powers between the regulators has not yet been made public.
Investor Protection and Requirements for Crypto Exchanges
A package of amendments proposed by Maxine Waters in July 2025 could form the basis of the future legislation.
It called for the introduction of additional safeguards for retail investors and clients of cryptocurrency platforms.
Specifically, it proposed requiring crypto companies to provide 24/7 customer support, process withdrawal requests within 24 hours barring certain exceptions, and segregate client assets from the companies’ own assets.
The initiative also included requirements to prevent front-running of client orders, establish standards for trade execution, implement asset protection mechanisms in the event of bankruptcy, and require monthly verification of reserves by independent auditors.
In addition, it was proposed to increase funding for the SEC and CFTC to carry out their oversight functions.
In July 2025, the House Rules Committee rejected a procedural motion to bring this amendment to the floor of the House by a vote of 8 to 4.
Consequently, these provisions were not included in the version of the CLARITY Act passed by the House of Representatives.
Possible Restrictions on Donald Trump’s Crypto Business
Another focus of the new bill could be restrictions on cryptocurrency activities by U.S. President Donald Trump, other federal officials, and their family members.
In 2025, Maxine Waters had already proposed including provisions from the “Stop TRUMP in Crypto Act” initiative into the CLARITY Act.
These provisions called for measures to prevent conflicts of interest related to the ownership of cryptocurrency assets, participation in relevant companies, and the receipt of income from digital financial instruments.
The issue has taken on additional political significance due to the Trump family’s involvement in cryptocurrency projects, particularly World Liberty Financial.
Democrats have previously raised concerns about potential conflicts of interest between the commercial activities of such entities and federal agencies’ decisions regarding cryptocurrency regulation.
At the same time, the specifics of the new restrictions have not yet been determined, and the mere discussion of legislative changes does not imply that the president or his affiliated companies have committed any violations.
Republicans are skeptical about the bill’s prospects
According to Eleanor Terrett, Republican Party representatives are already characterizing the upcoming initiative as a political bill designed primarily to demonstrate the Democrats’ regulatory priorities.
This assessment stems from potential disagreements between the parties regarding the division of powers between the SEC and the CFTC, as well as the proposed restrictions on federal officials.
The CLARITY Act, passed by the House of Representatives on July 17, 2025, by a vote of 294 to 134, was intended to establish a comprehensive federal regulatory framework for the digital asset market.
However, in September 2026, the bill failed to overcome a procedural hurdle in the Senate, stalling its further progress.
The new U.S. Congress will convene on January 3, 2027. Following the Democrats’ victory in the November 3 midterm elections, the party gained the ability to set the agenda for relevant committees and advance its own legislative initiatives.
At the same time, even with a Democratic majority in both chambers, the passage of the new law will depend on securing the necessary support in the Senate and the position of the president, who has the power to veto it.
The text of the new bill has not yet been officially released, and the date of its introduction to Congress has not been announced. Therefore, the proposed expansion of the SEC’s powers, a possible limitation of the CFTC’s authority, and new ethical requirements remain at the preliminary discussion stage.
For the U.S. cryptocurrency industry, such an initiative could signal a shift in the priorities of future regulation, particularly regarding the protection of client assets, oversight of trading platforms, and the delineation of federal regulators’ jurisdictions.
At the same time, the practical implications for crypto exchanges, token issuers, and institutional investors can only be assessed after specific legislative provisions are made public.
Sources: Eleanor Terrett, November 4, 2026, report; U.S. House of Representatives Committee on Rules, amendments to H.R. 3633 (CLARITY Act); U.S. House of Representatives Committee on Financial Services, materials on the CLARITY Act.
