CFTC unveils optional federal framework for leveraged crypto exchanges

The Commodity Futures Trading Commission released a proposal that would let U.S. cryptocurrency exchanges offering leveraged or margined trading join a uniform federal regulatory system. Under the plan, such platforms would be classified as "crypto asset markets" and would be subject to consistent rules nationwide, replacing one outlet reliance on varied state money-transmitter licenses. Required controls include measures to prevent market manipulation and a "proof of reserves" mandate to verify that customer assets are fully backed.

Additionally, the CFTC would require that all customer trades be processed through registered futures commission merchants. CFTC Chair Michael Selig presented the initiative at a Fordham University law school event, noting that it provides clarity for innovators operating in the emerging finance sector. The agency has long sought authority over spot crypto markets, a goal that only Congress can fully grant, and the proposal arrives after legislative attempts at comprehensive regulation stalled.