1inch Lawyers states that as the U.S. midterms unfold, crypto regulation will be driven by various institutions.

Senior executives in the crypto industry expect that, regardless of the outcome of the mid-term elections, U.S. regulatory agencies will take the lead in formulating crypto policies.

As the mid-term elections in the United States are underway and control of Congress remains undecided, 1inch's Deputy General Counsel Maylea Ma stated that she expects federal agencies to move forward to the next phase of crypto regulation.

This election may reshape the path forward for the stalled CLARITY legislation, but Ma indicates that "real progress" in US digital asset regulation over the next few years will come from the US Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), and the Treasury Department, rather than Congress.

Ma says that these institutions are increasingly coming into contact with crypto projects. However, such contacts at the institutional level do not provide the stability that the industry originally hoped to achieve through legislation.

"Of course, the long-term goal is still to have a law that is not repeatedly overturned with changes in government," said Ma.

According to Michael Ho, co-founder of D3, this uncertainty also affects institutional investors. D3 is the team behind Doma Protocol.

Ho said, 'As the market structure bill stalls, U.S. crypto policy still relies on institutional guidelines, and in the future, the government could overturn these guidelines, which is causing serious investors to remain on the sidelines.'

"Regardless of the outcome, clear rules established by law will bring institutional capital into the real-world assets of tokenization."

In August, SEC proposed an encryption financing framework that included exemptions for certain token issuances and a safe harbor arrangement that did not consider them as investment contracts. In September, SEC also updated the guidance for staff regarding token repurchases, encrypted networks, and pledged receipt tokens.

At the same time, CFTC submitted an encryption market regulation plan to the White House on September 17, two days after the Senate was unable to advance the CLARITY legislation.