CFTC proposes optional framework for leveraged crypto trading

The Commodity Futures Trading Commission on Monday proposed two rules that would create an optional federal framework for cryptocurrency exchanges handling certain leveraged, margined or financed retail trades. The proposal, called Regulation CTX and Regulation CAM, would establish a new category of crypto asset markets and set out a pathway for qualifying platforms to operate under CFTC oversight. The framework is focused on transactions involving borrowed funds or other financing, rather than direct spot trading in which buyers and sellers exchange crypto assets without leverage or margin. The proposal does not establish general federal oversight of that broader spot market. CFTC Chairman Michael Selig said the new category would be voluntary and that the agency cannot require crypto assets to trade on CFTC-registered platforms without action by Congress. Under the proposal, exchanges choosing the new registration category would face federal requirements. The CFTC’s announcement describes the rules as covering both the transactions and the platforms that host them.