CFTC Launches Innovation Task Force for Crypto, AI and Prediction Markets

TLDR

• The CFTC launched an Innovation Task Force to build regulatory frameworks for crypto, AI, and prediction markets
• The task force will be led by Michael Passalacqua and work with the CFTC’s Innovation Advisory Committee
• The SEC and CFTC signed a Memorandum of Understanding to coordinate crypto oversight and reduce conflicting rules
• Joint guidance confirmed most digital assets — including stablecoins and collectibles — are not securities
• The CLARITY Act, a market structure bill, remains stalled in the Senate

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The US Commodity Futures Trading Commission has launched a new Innovation Task Force to create clearer rules for crypto, artificial intelligence, and prediction markets.

CFTC Chair Michael Selig announced the move at the Digital Asset Summit in New York City on Tuesday. He said the task force will give builders and innovators a direct line to regulators.

Michael Passalacqua, a senior adviser to Selig, will lead the task force. Passalacqua previously worked on crypto and blockchain issues at international law firm Simpson Thacher & Bartlett before joining the CFTC in January.

The task force will work alongside the CFTC’s Innovation Advisory Committee, which includes more than 30 executives from companies like Kalshi and Nasdaq.

The CFTC’s move comes more than a year after the SEC launched its own crypto task force, one day after President Donald Trump took office.

SEC and CFTC Sign Agreement to Coordinate Rules

Earlier this month, the SEC and CFTC signed a Memorandum of Understanding to align their approaches to digital asset regulation. The agreement is designed to reduce the conflicting rules that had previously created friction between the two agencies.

The two agencies also issued joint guidance last week. That guidance stated that most digital assets — including stablecoins, digital commodities, and collectibles — are not securities.

The joint guidance introduced a formal “token taxonomy” to help classify digital assets. It also clarified that crypto activities like mining, staking, and airdrops generally do not count as securities transactions.

Under the MOU, the SEC and CFTC will coordinate on data sharing, joint rulemaking, product definitions, clearing, margin, and trade reporting.

SEC Chair Paul Atkins called the framework a “bridge” to bring clarity while Congress works on broader legislation.

A Joint Harmonization Initiative was also launched, co-led by Robert Teply from the SEC and Meghan Tente from the CFTC.

Market Structure Legislation Still Stalled

Congress has not yet passed a comprehensive digital asset law. The market structure bill, called the CLARITY Act, passed the House of Representatives in July 2025 but has since stalled in the Senate.

Debates over stablecoin yield, ethics, tokenized equities, and other issues have slowed progress. It is not clear when or if the bill will reach a full Senate floor vote.

The CFTC is also increasing its oversight of prediction markets. The agency has asserted authority over these markets despite pushback from some states citing local gaming laws.

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