The CFTC opened rulemaking on Oct. 5 for a federal framework that would let US crypto exchanges offer retail customers margined and leveraged trading. Exchanges that opt in would gain access to products that have helped offshore platforms attract active traders, but they would also accept deeper oversight, including customer-fund intermediation through registered brokers.
The Commodity Futures Trading Commission opened rulemaking on Oct. 5 for two new regimes, Regulation Crypto Asset Transactions (CTX) and Regulation Crypto Asset Markets (CAM), that would give US exchanges a federal path to offer retail leverage. The agency is acting under existing authority in the Commodity Exchange Act while Congress has yet to pass comprehensive crypto market-structure legislation.
A federal route to leveraged trading
Participation would stay optional. Ordinary spot exchanges could keep operating under state money-transmitter licensing, supplemented by the CFTC's existing anti-fraud and anti-manipulation authority. Platforms that want to offer margined or financed retail crypto trading could instead register under CTX, while exchanges offering futures and perpetual contracts would stay under the agency's existing designated contract market regime, with CAM sitting between the two.
Hyperliquid Policy Center said the resulting structure could give market participants a clearer regulatory ladder: state licensing for spot activity, federal CFTC oversight once leverage is introduced, and the existing derivatives framework for futures and perpetuals. Leveraged trading and perpetual contracts have helped offshore venues attract active traders, and US platforms have generally operated with a narrower product menu because of regulatory constraints.
FTX's collapse shapes the price of opting in
CFTC Chairman Michael Selig framed the initiative around lessons from FTX's bankruptcy. According to CryptoSlate: "the lesson from FTX's failure should have been obvious", Selig said on Oct. 5, arguing that fraud prevention should coexist with crypto innovation.
Exchanges that register under CAM would face requirements already applied to designated contract markets, covering financial integrity, surveillance and conflicts of interest, plus crypto-specific checks on token concentration, vesting schedules and buybacks. Platforms holding customer assets in omnibus accounts could also face proof-of-reserves requirements, a safeguard Selig linked directly to FTX. Customer trades would be intermediated through registered futures commission merchants, bringing accounts under capital, disclosure and segregation rules, along with Bank Secrecy Act obligations such as anti-money laundering checks.
That added oversight could force some exchanges to change the vertically integrated model that combines exchange, brokerage and custody functions under one roof. The Oct. 5 action is an advance notice of proposed rulemaking, so the agency is still seeking public input before drafting detailed rules on leverage limits, asset eligibility and custody.
Source: CryptoSlate
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