CFTC Proposes Crypto Regulatory Framework Following Failed CLARITY Act Vote

CFTC Proposes Unified Regulatory Approach for Crypto Firms

Michael Selig revealed that the CFTC plans to implement new rules for companies offering retail customers the ability to trade crypto assets on a margined, leveraged, or financed basis. The proposal, termed CTX, would create a new category called “crypto asset market” (CAM) where select exchanges could register as designated contract markets (DCM) under CFTC oversight.

Selig emphasized that these rules would provide a pathway for exchanges to operate under uniform national oversight by the CFTC, utilizing statutory authority previously used to regulate through enforcement rather than legislation. The CAM designation aims to offer clear legal footing for crypto exchanges at the federal level.

Scope and Limitations of the Proposed Regulation

According to the CFTC chair, the proposed rules would not cover ordinary spot crypto exchanges, which are generally regulated under state money transmission laws. However, the CFTC would retain authority to enforce anti-fraud and anti-manipulation measures against these spot trading platforms.

Thus, the regulatory framework is oriented primarily toward exchanges offering margin-based crypto trading, providing them a more structured and consistent regulatory environment.

Background on the Failed CLARITY Act and Regulatory Responses

The CFTC’s initiative follows the recent failure of the U.S. Senate to pass the Digital Asset Market Clarity (CLARITY) Act, which aimed to grant the agency expanded supervision and enforcement powers over crypto markets.

Prior to the CLARITY vote failure, the Securities and Exchange Commission (SEC) had already introduced its own tailored securities offering regime for crypto assets in August. Both agencies signaled readiness to advance regulatory frameworks without Congressional legislation.

Selig stated that President Trump pledged to establish a crypto asset regulatory market structure using existing statutory authorities, regardless of legislative branch support.

Staffing Levels and Future Appointments at the Regulators

Friday marked SEC Commissioner Hester Peirce’s last day at the agency before the end of her extended term, leaving only two commissioners currently leading the SEC, while Selig continues as the sole commissioner and chair of the CFTC.

A White House official informed Cointelegraph that President Trump intends to nominate new commissioners for both agencies in the near future. As of Monday, no official replacements for Peirce or other vacant commissioner positions have been announced.