U.S. CFTC Proposes First Crypto Rules Under CTX and CAM After CLARITY Act Fails

The U.S. Commodity Futures Trading Commission (CFTC) has proposed its first-ever crypto rules under two regulatory frameworks: the Regulation ‘Crypto Asset Transactions’ (CTX) and Regulation ‘Crypto Asset Markets’ (CAM). The Commission has also called for public comments on these proposed rules, which CFTC Chair Mike Selig noted would provide a comprehensive framework for CFTC-regulated exchanges that offer crypto trading.

Ad

Ad

CFTC Crypto Rules To Establish Comprehensive Regulatory Framework

In a press release, the Commission announced that it had published an Advanced Notice of Proposed Rulemaking to provide notice of, and seek public comment regarding its first-ever crypto rules. It noted that these rules will provide a comprehensive framework that will address retail crypto trading on CFTC-regulated exchanges.

This move follows the filing of the proposed CFTC crypto rules with the White House last month. The Commission is seeking public comments on topics such as how it can prevent abusive practices in crypto trading under a uniform national regime.

It is also requesting comment on how to provide crypto participants with information on common industry practices that are known to represent best practices for compliance with regulatory requirements around crypto transactions. Furthermore, the CFTC seeks comments on how best to codify a subcategory of designated contract market registration for crypto transactions.

“Today’s action is a critical step in the CFTC’s ongoing efforts to ensure America remains the crypto capital of the world,” Selig said regarding the proposed CFTC crypto rules. He further highlighted that this would provide clarity for American consumers and ensure consumer protection when trading crypto on CFTC-regulated exchanges.

Ad

Ad

What Regulation CTX And CAM Would Entail

The CFTC chair explained in an opinion article that Regulation CTX and CAM would establish requirements for CFTC-registered exchanges that offer crypto trading. He also distinguished these proposed rules from the CLARITY Act, noting that the regulations wouldn’t require crypto trading on CFTC-registered platforms.

“We don’t have the authority to impose such a requirement without congressional action. However, the rules would establish a purpose-fit option for crypto-asset exchanges that wish to operate under a single federal market-regulatory scheme,” he explained. Unlike state-licensed exchanges, these CFTC-registered platforms could offer margin and leverage trading to retail customers.

Meanwhile, Selig mentioned how the proposed CFTC crypto rules could help address regulatory gaps in the crypto market. However, he warned that they could not substitute for a statutory framework, and that the CLARITY Act remains necessary. The Senate’s cloture vote on the CLARITY Act failed last month, prompting the CFTC and SEC to move ahead with these proposed rules in the meantime.

For more on crypto regulation, check out Best Regulated Crypto Exchanges in the USA