How the CLARITY Act Divides SEC and CFTC Oversight

[chainsniff]

A central feature of the CLARITY Act is its functional split of regulatory authority between US agencies. The bill introduces the concept of a “digital commodity,” defined as a token whose value is primarily derived from the use of its blockchain rather than from managerial efforts.

Under the proposal, the CFTC would oversee most spot and secondary trading of qualifying digital commodities, including activity on exchanges and trading platforms. The SEC would retain authority over primary offerings, required disclosures and investor protection rules.

The legislation also emphasizes activity-based regulation. Exchanges, brokers and dealers would face registration, reporting and conduct standards, with the goal of improving transparency and market integrity while preserving innovation.

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calling something a digital commodity because it’s used on a blockchain kinda feels like lawyer talk for we have no idea what this is