CFTC Readies Own Crypto Rules as Congress Stalls on CLARITY Act

The Commodity Futures Trading Commission (CFTC) is preparing to create its own regulations for the crypto market, should Congress fail to pass the CLARITY Act. CFTC Chairman Michael S. Selig announced that his staff will explore rules to establish a CFTC framework for crypto assets, which would bring both registered and unregistered exchanges under regulatory oversight.

The proposed framework would enable current registrants as well as non-registrant crypto exchanges to be designated by the CFTC as a type of DCM known as a crypto asset market. This would allow for margined and leveraged cryptocurrency trades, subject to purpose-fit rules under the CFTC's regulatory oversight.

Selig also directed his staff to engage with developers of onchain finance protocols to establish ways in which they can offer their protocols in a legal and compliant manner in the United States. This includes discussing how these products can be sold without developers having to wonder about the boundaries of legality.