The US government shutdown is putting cryptocurrency policy progress on hold as the Securities and Exchange Commission (SEC) operates with limited staff, according to TD Cowen.

The SEC, which handles regulation of digital assets, has paused work on cryptocurrency-related initiatives, including exemptive relief for tokenization and new cryptocurrency products.

TD Cowen analysts said policy developments in the sector will not resume until Congress passes a funding agreement.

The shutdown also delays cryptocurrency exchange-traded fund reviews, some of which were expected to get approval soon.

As the SEC remains largely inactive, focus may shift to other agencies such as the Federal Reserve, Office of the Comptroller of the Currency, and Federal Deposit Insurance Corporation, which continue operating during the shutdown.

Analysts are monitoring how these agencies may address issues like stablecoin issuance, cryptocurrency custody, and tokenized payment systems.

🔗 Source: The Block