US CFTC to Propose Federal Regulatory Framework for Crypto Leveraged Trading

The US Commodity Futures Trading Commission (CFTC) on October 5 unveiled a comprehensive federal regulatory framework targeting crypto asset (virtual currency) transactions for retail customers and opened a public comment period. The framework would regulate crypto asset commodity transactions (CTX) involving margin, leverage, and lending, and would also establish a new market category for exchanges handling such products.

Published as an Advance Notice of Proposed Rulemaking (ANPRM), the framework consists of two pillars: "Regulation Crypto Asset Transactions (Regulation CTX)" and "Regulation Crypto Asset Markets (Regulation CAM)." CTX aims to establish rules for retail crypto asset commodity transactions under the Commodity Exchange Act, while CAM seeks to create a new subcategory of Designated Contract Markets (DCMs) — CFTC-registered markets — specifically tailored to crypto asset trading.

Comments will be accepted in writing, with a deadline of 60 days from publication in the Federal Register. Submitted comments will be posted on Regulations.gov, the US government's regulatory information portal. The CFTC plans to use the feedback in its future rulemaking deliberations.

A "federal option" distinct from state licensing