Blockchain-based digital assets have existed in an unregulated ecosystem since their inception—a rare financial sector with no comprehensive legislation or regulation, no dedicated regulator, and no clear guidance for those in the industry looking to play by the rules.

A number of federal agencies will ultimately play a role in regulating digital assets but only two are likely to lead the crypto regulatory regime: the Securities and Exchange Commission (SEC) or the Commodities Future Trading Commission (CFTC). But with comprehensive crypto legislation on the distant horizon, the SEC and CFTC are staking their claim to be the crypto regulator through aggressive enforcement actions. The recent crypto winter has provided the perfect opportunity for regulators to make their case, as crypto markets endure a deep freeze caused in part by several significant industry bankruptcies and growing concerns about the stability of crypto.