Regulators establish a framework for coordinated oversight, joint product guidance, and aligned enforcement, with a particular focus on cryptoassets and emerging financial technologies.

By Marc P. Berger, Zachary Fallon, John J. Sikora Jr., Yvette D. Valdez, Stephen P. Wink, Douglas K. Yatter, and Deric Behar

Key Points:

  • The agencies plan to clarify product definitions and oversight through joint interpretations and rulemakings, including a fit-for-purpose regulatory framework for cryptoassets and other emerging technologies.
  • The agencies pledge to end duplicative examinations and enforcement actions by agreeing to coordinate exam planning, sharing supervisory insights, and conferring on potential charges before filing parallel actions.
  • The MOU could facilitate the development of “super-apps,” where appropriately tailored compliance frameworks would allow firms to operate across product types under a unified regulatory structure.

Introduction

On March 11, 2026, Securities and Exchange Commission (SEC) Chairman Paul S. Atkins and Commodity Futures Trading Commission (CFTC) Chairman Michael S. Selig1 signed a Memorandum of Understanding (MOU) to guide coordination and collaboration on issues of shared regulatory concern.2 The MOU reflects both agencies’ stated commitment to provide fair notice to market participants, respect individual liberty, and foster lawful innovation with a “minimum effective dose” of regulation that promotes innovation, strengthens market integrity, and enhances US competitiveness in global finance.

The MOU is the culmination of recent Project Crypto announcements by Chairman Atkins and Chairman Selig, indicating increased SEC/CFTC collaboration and the reduction of duplicative oversight, most notably regarding digital asset markets.3

As evidence of the regulatory cooperation embodied in the MOU, on March 17, 2026, the SEC issued a significant Interpretive Release on digital assets (“Application of the Federal Securities Laws to Certain Types of Crypto Assets and Certain Transactions Involving Crypto Assets”), which was endorsed by Chairman Selig, stating that “The CFTC joined the interpretation to provide guidance the CFTC and its staff will administer the Commodity Exchange Act consistent with the SEC’s interpretation.”

The MOU: Structure and Substance

The MOU identifies six core areas where the agencies will clarify, coordinate, and harmonize their regulatory approaches:

  1. Issuing joint interpretations and rulemakings to clarify product definitions
  2. Modernizing frameworks for clearing, margin, and collateral
  3. Reducing frictions for dually registered exchanges, trading venues, and intermediaries
  4. Developing a “fit-for-purpose regulatory framework” for digital assets and emerging technologies
  5. Streamlining regulatory reporting for trade data, funds, and intermediaries
  6. Coordinating cross-market examinations, economic analyses, risk monitoring, surveillance, and enforcement

Guiding Principles

The MOU articulates five principles intended to govern SEC/CFTC coordination:

  1. Respect for statutory mandates and agency independence in carrying out their respective responsibilities
  2. Regulatory efficiency to reduce gaps, avoid duplication, and provide greater certainty regarding agency jurisdiction
  3. Good faith collaboration, consultation, communication, and constructive engagement
  4. Regulatory clarity and consistency to promote clear, consistent, and predictable regulatory approaches
  5. Functional and risk-based regulation

Notably, the MOU states that the agencies “will seek to collaborate and reject a ‘turf war’ mentality that would plague collaboration.” It also affirms that the agencies “jointly recognize the foundational importance of fair notice to market participants and not regulating through enforcement.” These commitments solidify a departure from the regulation-by-enforcement approach that critics assert characterized the agencies under the prior administration, particularly regarding digital assets and emerging asset classes.

Examination and Enforcement Coordination

For dually registered entities, the MOU creates a framework for coordinated oversight. The agencies commit to “coordinated exam planning, joint or aligned examinations where appropriate, and shar[ing] exam findings and supervisory insights.” The MOU provides that when a covered firm appears on the examination plan of both agencies, the agencies will seek to minimize the regulatory burden by considering a coordinated examination.

On enforcement, the MOU targets duplicative agency actions for the same conduct. The agencies agree to identify matters involving potential jurisdictional overlap at the commencement of any enforcement investigation, discuss areas of shared programmatic interest, and coordinate on potential charges, remedies, filings, strategy, and communications.

In his speech at the FIA Global Cleared Markets Conference on March 10, 2026, Chairman Atkins framed this commitment in unambiguous terms: “[T] he regrettable era of duplicative enforcement actions and conflicting remedial obligations for the same conduct is over. Conduct in a single operating environment means that the SEC and CFTC, within the bounds of their independent statutory authority and regulatory interests, should coordinate legal theories and remedial strategies. Fragmented, redundant enforcement does not increase deterrence – it only increases confusion.”

Data Sharing and Market Surveillance

The MOU establishes procedures for sharing data between the agencies regarding matters and transactions with shared regulatory oversight. The agencies agree to collaborate efficiently on the necessary confidentiality arrangements to enable direct access to data from swap and security-based swap data repositories.

The agencies also commit to sharing analytical and monitoring capabilities to improve visibility across the swap and security-based swap markets and products, supporting the identification of emerging risks.

The MOU further contemplates coordination on procurement activities related to acquiring on-chain market data and related analytical tools.

The SEC/CFTC Harmonization Initiative

Alongside the MOU, the SEC and CFTC announced the creation of a joint Harmonization Initiative to “advance coordinated oversight and promote regulatory clarity in areas of common regulatory interest.” The initiative operationalizes the coordination principles and processes outlined in the MOU by supporting agency coordination across policymaking, examination, risk monitoring, surveillance, and enforcement functions, and aims to develop clear and efficient joint frameworks or to streamline existing definitions and frameworks.

The agencies have launched a Harmonization Initiative website where market participants can submit written input or request a coordinated meeting with SEC and CFTC staff to discuss harmonization issues and propose solutions.

Chairman Atkins has also directed SEC staff to begin joint meetings with CFTC staff to promote coordinated responses to product applications (such as for novel derivative or digital asset products) or to requests for exemptive relief. He emphasized that firms should not be shuffled between regulators when products implicate both frameworks, and that overlapping jurisdiction calls for a coordinated response.

Substituted Agency Compliance and the Super-App Framework

The MOU also reflects the agencies’ continued commitment to “facilitate alternative compliance and enable a path for appropriately tailored and regulated ‘super-apps.’” Chairman Atkins and Chairman Selig envision a super-app as a unified financial platform that allows users to access traditional securities, derivatives, cryptoassets, and banking services, guided by a coordinated, simplified regulatory framework. This model aims to merge fragmented and siloed services into a single user experience, removing the need for multiple, overlapping state and federal licenses for digital asset intermediaries.

Most recently, SEC Chairman Atkins addressed this concept in his FIA speech, pointing out what he sees as inefficiencies in the regulatory status quo: “A dually registered firm must navigate two agencies, two regulatory regimes, two or more examination cycles, two reporting pipelines, and often two supervisory cultures, even where the underlying risks are substantially similar.” To counter these redundancies, the super-app model is intended to enable market participants to access multiple services and asset classes through a single platform without navigating duplicative registrations.

The principle underlying the super-app concept, Chairman Atkins explained, is that “where one agency’s framework achieves comparable regulatory outcomes, then it should be capable of satisfying overlapping requirements of the other.”

Practical Implications

The MOU and Harmonization Initiative represent a significant commitment to regulatory coordination and are part of a broader deregulatory shift at both agencies. CFTC Chairman Selig has described his approach at the CFTC as “‘future-proofing’ derivatives markets oversight via the minimum effective dose of principles-based regulation,” criticizing the implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act in the wake of the 2008 financial crisis as complex, onerous, costly, and ultimately harmful to market participants. To counter this regulatory burden, Chairman Selig has directed CFTC staff to reduce duplicative compliance obligations for dually registered entities, and to consider amending capital, margin, and reporting rules “where they exceed what is necessary for risk management.”4

For dually registered firms, the prospect of harmonized reporting requirements and coordinated supervision and examination could meaningfully reduce compliance burdens. For market participants operating in jurisdictional gray zones (particularly in digital assets), the SEC and CFTC’s commitment to joint interpretations and rulemakings offers a path toward regulatory clarity that has been absent for years. The agencies’ stated commitment to innovation and to processing market participant applications without undue delay may also promote the introduction of new financial instruments and platforms.

Follow this and other critical developments on Latham’s US Crypto Policy Tracker.