CFTC Seeks Public Input on New Crypto Regulatory Framework

The US Commodity Futures Trading Commission (CFTC) has launched an effort to create a complete regulatory framework for crypto asset transactions, inviting public feedback on proposed rules. On Monday, the CFTC issued an Advanced Notice of Proposed Rulemaking (ANPRM), asking for input on how to develop “fit-for-purpose” regulations for crypto transactions under Section 2(c)(2)(D) of the Commodity Exchange Act.

CFTC Chairman Michael S. Selig emphasized that the initiative aims to provide clarity and consumer protections in the crypto markets. “The American people deserve clarity, certainty, and consumer protections in the crypto asset markets,” Selig stated, noting that the CFTC is committed to integrating crypto transactions into its national regulatory framework.

The proposed framework seeks to prevent abusive practices and establish a uniform regulatory system for crypto transactions. The CFTC is also seeking views on providing market participants with crypto-specific guidance on regulatory requirements and industry best practices. Additionally, the agency is considering creating a new category of designated contract market called a “crypto asset market” for retail transactions involving crypto assets.

Selig highlighted that the agency’s approach will focus on preventing misconduct rather than relying solely on enforcement after violations occur. “Under my leadership, the Commission will take every necessary step to establish regulations that are designed to prevent, rather than only prosecute after the fact, fraudulent schemes such as FTX,” he said.

The CFTC will accept written comments from market participants and stakeholders for 60 days following the publication of the notice in the Federal Register.