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1. Why might tokenization and stablecoins survive the midterm results?
Tokenized securities and stablecoin payments can keep advancing under laws that already exist, according to industry lawyers and executives who spoke on November 4, 2026, after Democrats won control of Congress in the midterm elections. The broader digital asset agenda in Washington, including President Donald Trump's goal of making the United States the world's crypto capital, now faces a harder political landscape, while the SEC and CFTC must prepare for sharper congressional scrutiny.
The distinction matters because two very different bodies of work are involved. One is legislation, which needs votes from a divided Capitol. The other is the day-to-day activity of regulators and market participants who operate inside statutes passed years ago. The experts quoted this week argue that tokenization and payment stablecoins belong mostly to the second category, which gives them a measure of insulation from the shift in power.
That reading does not mean the election changes nothing. Several of the people consulted pointed to open questions about how long current regulatory efforts will last and about the fate of a comprehensive market structure bill. Their views, set out below, separate what appears settled from what has become uncertain.
For readers following the sector, the practical question is whether the plans already in motion can proceed without new laws. Large financial institutions have spent months designing products that place stocks, bonds and funds on blockchain networks, and stablecoin payment businesses have been growing alongside them. The answer from the specialists quoted here is largely yes, because both activities fit within existing legal categories.
2. What do tokenization specialists expect from regulators?
Peter Curley, head of global regulatory affairs at tokenization firm Ondo Finance, said he expects the SEC and the CFTC to field more questions from lawmakers in the new Congress. He nonetheless sees little reason for tokenized securities to stall, noting that the agencies have already made substantial progress without waiting for new legislation. In his view, tokenized finance could move on a different timetable from the wider crypto policy debate.
Aaron Kaplan, chief executive of Prometheum, a regulated digital asset firm, also expects business to continue and named three developments behind that view. Broker-dealers are exploring crypto offerings that could be placed inside ordinary brokerage accounts. Issuers of securities are building their own tokenization strategies. And trading venues abroad are examining a tokenization service from the Depository Trust & Clearing Corporation, known as DTCC, as a way to offer tokenized U.S. equities to customers outside the country.
Kaplan summarized the approach as using the securities laws that are already on the books. Tokenization, in this framing, changes the technology that records ownership and settles trades rather than the legal character of the instrument, so existing securities rules can apply to it without a new statute.
3. How does the GENIUS Act protect stablecoin regulation?
Stablecoin regulation rests on the GENIUS Act, which Congress passed in 2025 with bipartisan support. The law created a federal framework for payment stablecoins, requiring issuers to back their tokens with liquid reserves and to comply with oversight at either the federal or the state level. A stablecoin is a crypto token designed to hold a steady value, usually one U.S. dollar, which is why reserve rules are central to any regulatory scheme.
Abhishek Vaidyanathan, chief legal officer of the NEAR Foundation, pointed out that the act passed with Democratic votes and takes effect on January 18, fifteen days after the new Congress is seated. That timing, he said, gives issuers a statute to work from regardless of the changed balance of power. A law that attracted support from both parties is also harder to reopen than one passed along party lines.
Implementation is already moving through the Federal Reserve, which put forward a proposal in September to carry out the act. Vaidyanathan added that the remainder of the market continues to operate under existing law, regulatory interpretations and proposed rules, so the stablecoin sector has both a statute and a rulemaking process in place.
This combination of a statute with a fixed start date and an agency rulemaking underway is what distinguishes stablecoins from other parts of the crypto market. Issuers can plan around known requirements on reserves and supervision instead of waiting for Congress to act, which is the circumstance that leaves other sectors dependent on legislation that now looks harder to pass.
4. Which SEC and CFTC rules face a durability test?
U.S. regulators spent much of 2026 writing crypto rules without comprehensive legislation, filling gaps that Congress left open. The SEC has proposed bringing blockchain technology into the rules that govern transfer agents, which maintain records of who owns a security. It has also proposed an exemption for venues that trade tokenized securities and a framework called Regulation Crypto Assets, which would ease certain requirements for crypto offerings.
At the CFTC, work has advanced on perpetual futures, a crypto-style derivative that has no expiration date and lets traders bet on the price of an asset. Together these initiatives make up much of the current regulatory agenda for digital assets, and the Democratic victory raises questions about how much of it can be finalized before Trump's term ends.
Elizabeth Lan Davis, who leads the commodities and derivatives practice at Davis Wright Tremaine and previously served as a chief trial attorney at the CFTC, expects the election to slow agency work. She said it will likely slow dramatically, especially if Democratic commissioners are appointed. Commission membership shapes how quickly a proposal becomes a final rule, so changes in the roster could complicate efforts to complete the agenda on schedule.
5. Will the midterms really slow the digital asset agenda?
Not every lawyer agrees that the pace will drop. Kris Swiatek, a partner at Seward & Kissel, said he does not expect the midterms to materially slow the digital asset agenda at the SEC or the CFTC. He does anticipate that Democratic control will bring more scrutiny of agency authority and rulemaking, but he believes regulators can continue to work within existing law.
Both lawyers identified a larger concern, which is how long the rules will remain in force. Guidance issued by an agency can be withdrawn by a future administration, while formal regulations take longer to reverse because the process of repealing them is itself lengthy. Changes in commission membership could further complicate any attempt to finalize rules before the current term ends.
Davis framed the issue as one of staying power. The real question, she said, is how much sticking power these efforts have through a change of administration. She added that unwinding rules takes time, so any effect is unlikely to be immediate. For companies planning products around the new frameworks, that lag offers some predictability even if the long-term outlook is unsettled.
The comparison with the failed bill is instructive. A market structure law would have set permanent boundaries between agencies, whereas rules written by a single administration can be revised by the next. Companies therefore weigh the benefit of moving quickly under favorable guidance against the risk that the guidance changes, and the lawyers quoted here suggest that the formal, slower-to-reverse regulations are the ones that offer the most lasting certainty.
6. What happens to broader federal crypto legislation?
The prospects for comprehensive legislation look weaker. Vaidyanathan said Democratic control further dims the outlook for a broad crypto law, since the Clarity Act, the market structure bill, failed to advance in the previous Congress. The bill was meant to settle which agency oversees which parts of the market, and its stall leaves that division to be managed through agency rulemaking and court decisions.
A future bill could still emerge. According to the discussion, it might keep the existing split of oversight between the SEC and the CFTC while adding tougher provisions on illicit finance and on conflicts of interest involving elected officials. Such additions would reflect priorities that Democrats have raised in earlier debates over the industry.
Decentralized finance, or DeFi, could produce the sharpest disagreements, Vaidyanathan said. Democratic proposals have sought broader oversight of the people who design, control or profit from applications that give users access to decentralized protocols. That approach raises questions about protections for software developers, who have argued that writing code should not by itself make someone responsible for how others use it.
7. What comes next for crypto policy?
The first fixed date is January 18, when the GENIUS Act takes effect, two weeks after the new Congress convenes. Before and after that, the SEC and CFTC will continue working on their proposals, now with a Congress inclined to ask more questions about their authority and their methods.
For Wall Street firms and stablecoin issuers, the practical picture is one of continuity in the near term and uncertainty further out. Tokenization and payments can proceed under current law, and the people closest to those businesses say they expect to keep building. The open items are the durability of agency rules beyond the current administration, the composition of the commissions that must approve them, and whether lawmakers can find a bipartisan formula for a market structure bill that addresses illicit finance, official conflicts of interest and the treatment of DeFi developers.
Until those questions are answered, regulation of the sector will be shaped less by Congress than by agencies, courts and the companies that choose how to operate within the rules already in place.