The US Commodity Futures Trading Commission (CFTC) has proposed to create clearer rules for the crypto market, with Chairman Mike Selig outlining a new approach that would bring leveraged and margin-based crypto trading under federal oversight. The agency is seeking public views on two proposals, called Regulation CTX and Regulation CAM.
🚨 BREAKING NEWS 📺 https://t.co/hbDcjjI69B
— Mike Selig (@ChairmanSelig) October 5, 2026
The plan would create a new category of crypto platforms known as Crypto Asset Markets, or CAMs. However, the CFTC still does not have broad authority over ordinary spot crypto trading. Direct buying and selling of Bitcoin and Ether would therefore largely remain under state rules unless Congress changes the law.
Selig explained his broader vision for crypto regulation at the Fordham Law Blockchain Regulatory Symposium in New York on October 5. He said the CFTC should move towards rules designed specifically for digital assets instead of mainly using enforcement actions to deal with problems after they happen.
Source: cftc.gov
The latest move comes after Congress failed to pass the CLARITY Act. The legislation was expected to provide a broader market structure for digital assets, including clearer rules about which regulator should oversee different parts of the crypto industry.
The CFTC is now trying to use the powers it already has. Under the proposed Regulation CTX framework, crypto trading involving retail customers would come under CFTC oversight when it involves leverage, margin or financing. In simple terms, if a customer borrows money to take a larger crypto position, the transaction could fall under the proposed federal framework.
Selig said crypto businesses should have a choice between state licensing and federal registration depending on what they actually do. Ordinary spot exchanges that do not offer leveraged or financed retail trading could continue operating under state money-transmission rules. Exchanges offering these more complex products would face CFTC oversight.
.@CFTC Seeks Public Comment on Advanced Notice of Proposed Rulemaking Relating to Regulation Crypto Asset Transactions and Regulation Crypto Asset Markets: https://t.co/0RFFzG0MPp
— CFTC (@CFTC) October 5, 2026
This is where the biggest question remains. The CFTC does not currently have general authority over the spot market. Spot trading means buying or selling an asset directly at the current market price, without leverage or margin. This covers a very large part of the crypto market, including ordinary Bitcoin and Ether transactions.
The CFTC can still take action against fraud and market manipulation in spot markets. But its latest proposals do not replace state rules governing ordinary spot trading. CFTC officials also said they want to understand how large the remaining state-regulated market would be after the new federal framework is introduced. The proposals have now opened a 60-day public comment period.
One of the most important parts of the plan is the proposed Crypto Asset Market, or CAM, category. It would give certain crypto exchanges a more specific federal regulatory route. CAMs would be subject to requirements covering areas such as customer funds, market surveillance, financial integrity, conflicts of interest and protection against manipulation. The CFTC is also considering rules about which crypto assets exchanges should be allowed to list.
Another proposed requirement is proof of reserves for exchanges that keep customer assets in omnibus accounts. The basic idea is to give regulators and customers greater visibility into whether an exchange actually holds the assets it says it holds.
The lesson from FTX’s failure should have been obvious. America shouldn’t have to choose between responsible innovation in crypto and protecting market participants from fraud and abuse. It needs prophylactic rules that reasonably ensure both. Today, the @CFTC is taking action to make that possible.
— Mike Selig (@ChairmanSelig) October 5, 2026
The proposed CTX system would also require futures commission merchants, or FCMs, to act as intermediaries for retail customers. These firms already operate under Commodity Exchange Act requirements covering areas such as customer funds, capital and disclosures. Their involvement would also bring customer activity under relevant Bank Secrecy Act requirements, including customer identification and anti-money-laundering rules.
Selig is also looking at another difficult area: decentralized crypto software. He said the CFTC is talking to developers and founders to understand how on-chain platforms work and where control over transactions actually sits.
The agency is considering protections for developers who simply create and publish software but do not take customer orders, control transactions or hold customer funds. Selig argued that someone should not automatically have to register as an introducing broker simply because they wrote and released software.
The CFTC’s latest move also follows several steps by the Securities and Exchange Commission (SEC). The two agencies have been working towards clearer lines between their respective areas of responsibility. Earlier this year, they worked together on a token taxonomy aimed at explaining which digital assets could fall under the SEC or CFTC.
However, the new CFTC proposals are not final rules yet. The October 5 action is an advance notice of proposed rulemaking, meaning the agency is asking the crypto industry and other interested parties for feedback before deciding what formal rules should look like.
For the US crypto industry, the development is still important. It could provide a clearer federal route for businesses dealing in leveraged crypto products and give exchanges more specific rules to follow. But ordinary spot trading remains the unresolved part of the picture.
Until Congress gives the CFTC wider authority, the US crypto market may continue to operate under a mix of federal and state rules. Selig’s latest proposals are therefore a significant step towards a clearer framework, but they do not yet provide the complete regulatory system that many crypto businesses have been waiting for.
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