The U.S. regulatory landscape for digital assets shifted on two fronts this week, as the Securities and Exchange Commission's most consistent industry ally announced her departure and a federal appeals court dealt another setback to prediction-market operator Kalshi. Together, the developments underscore how unsettled the American approach to crypto oversight remains, even as agencies push out new guidance almost weekly.
SEC's "Crypto Mom" Sets a Departure Date
SEC Commissioner Hester Peirce, widely known in the industry as "Crypto Mom" for her long-running push for clearer, rules-based treatment of digital assets, has confirmed she will leave the agency on October 2. Peirce posted her resignation letter on social media, thanking the administration for what she called the honor of her professional lifetime.
Peirce joined the commission in January 2018 and became director of the SEC's Crypto Task Force in February 2025, a role in which she helped shape the agency's recent shift toward formal rulemaking, including the proposed "Regulation Crypto Assets" framework and a five-year innovation exemption designed to let qualifying platforms trade tokenized securities. She has previously criticized the SEC's older enforcement-heavy approach, arguing that years of "enforcement actions and no-action letters" left the industry without real clarity.
Her exit leaves the five-seat commission with just two sitting members, Chairman Paul Atkins and Commissioner Mark Uyeda, both Republican appointees. Under SEC rules, two commissioners are enough to maintain a quorum, but the reduced bench raises questions about how quickly pending crypto rulemaking can move forward. Peirce is expected to join Regent University School of Law in Virginia as an associate professor.
Kalshi Suffers a Second Appellate Loss
Separately, the Sixth Circuit Court of Appeals ruled Friday that Kalshi has not shown its sports-related event contracts qualify as "swaps" under federal commodities law, meaning the products are not shielded from state gambling regulation. The unanimous panel, led by Senior Circuit Judge Julia Smith Gibbons, held that even if Kalshi's contracts were swaps, the Commodity Exchange Act would not preempt Ohio's or Tennessee's gambling statutes.
The decision affirmed a lower court's denial of an injunction sought by Kalshi in Ohio and vacated a Tennessee court order that had previously blocked state enforcement. It marks the second time in as many months that a federal appeals court has sided with states over Kalshi: the Ninth Circuit reached a similar conclusion regarding Nevada in August. That ruling stands in contrast to an April decision from the Third Circuit, which allowed Kalshi to keep operating in New Jersey while its appeal proceeds, leaving a clear split among the circuits.
Kalshi has argued that a state-by-state patchwork is unworkable and that federal courts remain divided on the basic legal question. With roughly twenty states now involved in litigation against prediction-market platforms, legal observers widely expect the U.S. Supreme Court to eventually take up the underlying jurisdictional dispute.
What It Means for the Industry
Taken together, the two developments point to a regulatory environment still very much in motion. The SEC's crypto-friendly rulemaking push now continues with one fewer champion at the table, while the prediction-market sector faces mounting legal uncertainty at the state level. Both threads are likely to keep U.S. policymakers, courts, and industry participants occupied well into the fourth quarter.
