Democrats Plan Tougher Crypto Rules With Bigger SEC Role After Midterms

Democrats are preparing to reshape US cryptocurrency regulation after winning control of both chambers of Congress in the 2026 midterm elections. House lawmakers are reportedly discussing a new crypto market-structure proposal that would expand the Securities and Exchange Commission's (SEC) authority, strengthen investor protections and introduce ethics restrictions targeting President Donald Trump and other federal officials.

The discussions could mark a significant shift from the Republican-led approach to digital asset regulation over the past two years. Democrats will take control of Congress in January 2027, while Senator Elizabeth Warren is expected to become chair of the Senate Banking Committee.

However, the proposed legislation remains at an early stage. No formal bill text has been released, and the reported plans are based on information shared by industry sources familiar with discussions among Democratic staffers.

House Democrats Consider Expanding SEC Oversight

The proposed legislation could revive elements of Representative Maxine Waters' Crypto Investor and Consumer Bill of Rights and combine them with provisions previously considered during negotiations over the Digital Asset Market Clarity Act, commonly known as the CLARITY Act.