CFTC Seeks Comments on New Rules for Leveraged Crypto Trading
The U.S. Commodity Futures Trading Commission (CFTC) has proposed new rules to regulate leveraged and margined crypto trading under a federal framework. On October 5, the CFTC published an Advanced Notice of Proposed Rulemaking (ANPRM) seeking public comment on a plan to create a new “crypto asset market” registration category for platforms offering leveraged, margined, or financed trading to retail customers.
The proposal aims to cover derivatives like perpetuals and prediction markets, while basic spot trading would remain under state oversight. The CFTC’s move follows Congress blocking the Digital Asset Market Clarity Act, which sought to split crypto oversight between the CFTC and the SEC. CFTC Chairman Michael S. Selig described the measure as a “federal option for crypto asset exchanges,” emphasizing that Congress alone can mandate universal registration.
The ANPRM addresses abusive practices in crypto markets and seeks to provide clarity and consumer protections. It also aims to codify the “crypto asset market” subcategory of designated contract market registration. Comments on the proposal must be submitted within 60 days of its publication in the Federal Register.
The CFTC’s proposal comes alongside recent regulatory actions, including the SEC’s approval of the first 3x leveraged Bitcoin and Ether ETPs. Selig highlighted the importance of preventing fraudulent schemes, citing the FTX collapse as an example of the need for proactive measures.