The U.S. Commodity Futures Trading Commission (CFTC) has proposed two new rules to regulate crypto trading, paving the way for federal oversight of leveraged, margined, or financed transactions. The proposal comes as the U.S. Congress has yet to pass crypto market structure legislation, prompting the agency to fill the regulatory void using its existing statutory authority.

Two Rules Targeting Two Distinct Layers

Regulation CTX and Regulation CAM form a dual-track approach that the CFTC describes as a comprehensive regulatory framework. Regulation CTX directly governs trading, while Regulation CAM establishes a new exchange category for entities operating those activities.

Technically, a key element to note is that these new trading venues do not necessarily need full designated contract market (DCM) status, falling instead into a narrower category. Major platforms such as Coinbase and Bitnomial, as well as prediction markets like Kalshi or Polymarket, have already completed DCM registration. Holding full DCM status is only mandatory for entities offering futures, options, and swaps.

For retail investors, the critical takeaway lies in the strict operational standards that exchanges must satisfy:

  • Completely segregate customer assets from corporate funds.
  • Meet regulatory minimum capital requirements.
  • Strictly comply with anti-money laundering provisions under the U.S. Bank Secrecy Act.
  • Demonstrate actual capital reserves when managing customer assets in omnibus accounts.

Notably, a transaction is deemed an actual delivery of assets if completed within 28 days, even when funds or assets are withdrawn to external, non-custodial wallets.

The Spot Market Remains Left Open

Because the CFTC lacks authority over spot transactions—direct, non-leveraged purchases where the underlying asset is delivered at the prevailing market price—the vast majority of Bitcoin and Ethereum trading currently falls outside the agency’s direct supervision. The CFTC’s only enforcement power in the spot arena is to pursue fraud or market manipulation.

This gap was expected to be addressed by the Digital Asset Market Clarity Act, but the legislation stalled in the U.S. Senate last month. Seeking to fill this void, the CFTC and the U.S. Securities and Exchange Commission (SEC) are actively coordinating through administrative rulemaking. For its part, the SEC moved first by unveiling a proposal on digital asset custody mechanisms for investment funds while issuing exemptive relief to facilitate the tokenization of securities.

According to CFTC Chairman Michael Selig, the new rules aim to establish a clear regulatory framework grounded in the same statutory authority that the previous administration used for regulation by enforcement. However, enforcement capacity faces staffing hurdles as both agencies suffer severe commissioner shortages: Selig has been the CFTC’s sole active member for nearly a year, while the SEC operates with only Chairman Paul Atkins and Commissioner Mark Uyeda because the President has yet to appoint replacements for vacant seats.

SEC and CFTC Asset Classification Framework

In connection with this direction, the CFTC Chairman referenced a joint digital asset classification framework previously unveiled by the two agencies. Under that framework, cryptocurrencies such as BTC, ETH, SOL, XLM, XTZ, and XRP are categorized as “digital commodities.”

The scope of this classification framework extends beyond exchanges. The CFTC indicated it is developing a long-term policy tailored for open-source developers—groups that merely publish software, do not accept orders, do not operate trading venues, and do not hold customer assets. This represents a critical step toward establishing legal clarity for a cohort that previously lacked clear guidance within the incomplete U.S. crypto regulatory environment.

The proposed rules are currently open for a 60-day public comment period. Officials acknowledged that it is difficult to accurately assess the remaining scale of the spot market until comprehensive feedback is received, though they also noted that users will likely prefer trading on federally regulated platforms.

The key question moving forward is whether these administrative rules will adequately address regulatory needs, or if the U.S. Congress will still need to pass dedicated market structure legislation in its upcoming session.