US SEC, CFTC operations set to resume after 43-day government shutdown

Employees who were furloughed during the US government shutdown are expected to return to work at the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) after 43 days away. According to operation plans with the SEC and CFTC, staff are set to return on Thursday. This follows US President Donald Trump’s signing of a funding bill late on Wednesday to resume federal operations. The plans of both agencies require employees to come in on the “next regularly scheduled workday [...] following enactment of appropriations legislation,” a statement that acting CFTC Chair Caroline Pham appeared to confirm in a Thursday X post.

Amid the government shutdown, both agencies operated with fewer staff and reduced operations. The SEC’s limited capacity impacted its ability to review important applications like those for exchange-traded funds (ETFs), including cryptocurrency-related ones. Meanwhile, the CFTC’s operations suffered drastically, as the agency ceased “the vast bulk of its operations”—this included enforcement, market oversight, and regulatory rulemaking. The reopening of the government now means the agencies face the challenge of catching up on activities delayed during the 43 days shutdown.

With the reopening, the SEC and CFTC may require additional time to process overdue activities, including reviewing registration applications submitted during the shutdown. Some companies took advantage of the situation, submitting IPO and ETF applications knowing they would remain in the queue until operations resumed. Jay Dubow, a partner at Troutman Pepper Locke, noted, “Every time you go through something like this, there’s the risk of things just slipping through the cracks.” This underscores the potential repetitive ramifications of shutdowns on regulatory performance.

During the shutdown, officials from both the SEC and CFTC continued to speak at conferences, shedding light on their approach to cryptocurrencies despite reduced operations. SEC Chair Paul Atkins remarked on October 7 that the agency was “functioning within limits” but faced restrictions. He added that planning was underway to consider “establishing a token taxonomy” guided by the Howey test to define when investment contracts can conclude. Similarly, Caroline Pham mentioned the CFTC's intent to push approval for leveraged spot cryptocurrency trading as early as December.

Michael Selig, chief counsel for the SEC’s crypto task force, is scheduled to appear before the Senate Agriculture Committee on Wednesday as part of President Trump’s efforts to confirm him as the next CFTC chair. Though the shutdown might not have prevented the hearing, Selig’s authority would have been severely restricted if confirmed during the period. Acting Chair Caroline Pham is expected to step down from her position if Selig is confirmed. However, leadership challenges persist as the CFTC continues to operate with only one Senate-confirmed commissioner instead of the standard five.

Looking ahead, the SEC and CFTC face considerable catch-up work as they return to full operations. Discussions around cryptocurrency regulation and oversight highlight the agencies’ commitment to addressing pending legislative and operational priorities. As agencies recover, stakeholders remain cautious over the possibility of repeated disruptions impacting long-term goals, particularly in sectors like crypto funding and financial innovation.