Supreme Court expands removal power, complicates crypto rules

The Supreme Court ruled 6–3 last week to expand the president’s authority to remove leaders of many independent federal agencies, excluding the Federal Reserve. The case began after the 2025 firing of FTC Commissioner Rebecca Slaughter.

The decision comes while the Securities and Exchange Commission and the Commodity Futures Trading Commission are pursuing rulemaking, exemptions and enforcement policies for digital assets. The SEC currently has three Republican commissioners. The CFTC is led solely by Chair Michael Selig, the agency’s only commissioner.

Both agencies are structured as multi-member commissions with a statutory limit of no more than three commissioners from the same political party. Those full panels have in past years produced rules debated across multiple viewpoints and often secured bipartisan votes.

One former agency official warned that fewer commissioners may reduce internal debate and produce weaker deliberations. “I’m a firm believer that more minds and more debate and more friction of ideas will lead to better outcomes,” the official said, adding that truncated deliberations might yield “suboptimal” rules and make regulations easier to revisit.

A former CFTC official noted that federal rulemaking remains bound by statutes and the Administrative Procedure Act, which require notice-and-comment procedures and other safeguards. The official added that if agencies follow statutory quorum rules and the APA, their actions retain legal force even with fewer commissioners.

The ruling has legislative implications. Lawmakers are negotiating a bill that would split oversight of digital assets between the SEC and CFTC and expand the CFTC’s authority. Some members of Congress have urged the president to fill CFTC vacancies to create a full commission that could vote on any new regulatory framework.

The president’s recent financial disclosure showed substantial bitcoin and ether holdings tied to World Liberty Financial, a company associated with the family business. Tyler Gellasch, president and CEO of the investor-focused Healthy Markets Association, said the president’s public statements and business ties make it reasonable to expect regulators will align with presidential views on crypto and prediction markets.

Observers say rules adopted by a reduced commission may be easier for later administrations to revisit. Regulators and industry participants will monitor upcoming SEC and CFTC actions to see how the ruling affects agency voting, the timing of rulemaking and legal challenges. Officials expect the full impact to become clearer as agencies complete statutory notice-and-comment processes and as Congress considers changes to agency structure or staffing requirements.