"Regulators Chart Clear Path for Spot Crypto Trading in U.S. Markets"

The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have announced a joint initiative under the umbrella of the SEC’s Project Crypto and the CFTC’s Crypto Sprint to facilitate the trading of certain spot crypto asset products. This move aligns with the President’s Working Group on Digital Asset Markets report, which advocates for regulatory clarity and support for blockchain innovation within the United States. The initiative aims to enable U.S.-registered exchanges to trade spot crypto assets, including those that are leveraged, margined, or financed, by clarifying the existing legal framework and encouraging coordination between the SEC and CFTC [1].

According to the joint statement, current law does not prohibit SEC- or CFTC-registered exchanges from facilitating such trading. The Divisions emphasized that their goal is to enhance choice and flexibility for market participants by promoting regulatory clarity. The statement also clarifies that the Commodity Exchange Act does not preclude the trading of these products on designated contract markets, foreign boards of trade, or national securities exchanges, provided certain exceptions and reliefs are met. This interpretation is intended to provide a more predictable environment for market participants [1].

The joint initiative outlines several considerations for market participants. First, it addresses the operational aspects of margin, clearing, and settlement, noting that clearinghouses can partner with custodians to manage customer accounts. Both the SEC and CFTC have indicated their willingness to engage with registered entities to address any regulatory questions arising from such commercial relationships. Furthermore, the Divisions highlighted the importance of sharing reference pricing venues among exchanges and trading platforms to enhance market surveillance and transparency [1].

In the context of public dissemination of trade data, the Divisions expressed their view that making transactions by national securities exchanges and designated contract markets publicly available provides valuable market data for investors and analysts. This transparency is seen as a critical component of maintaining fair and orderly markets. The Divisions also emphasized the role of efficient execution and transparency in promoting competition and trading opportunities for participants. They are prepared to engage with exchanges on the principles of fair and orderly trading as they seek to operate in the spot crypto asset market [1].

The Spring 2025 Unified Agenda of Regulatory and Deregulatory Actions, released by the Office of Information and Regulatory Affairs, further underscores the SEC’s focus on supporting innovation and investor protection in the crypto asset space. The agenda outlines potential rule proposals aimed at clarifying the regulatory framework for the offer and sale of crypto assets. A key priority is the development of clear rules for the issuance, custody, and trading of crypto assets, while continuing to discourage fraudulent activity. Additionally, the agenda includes plans to reduce compliance burdens and modernize existing rules to address disclosure issues and facilitate capital formation [2].

Collectively, these developments represent a significant shift in the U.S. regulatory approach to crypto assets. By fostering coordination between agencies and providing clearer guidance, the SEC and CFTC aim to establish the U.S. as a leading jurisdiction for blockchain innovation and digital asset market participation. Market participants are now encouraged to engage with the SEC and CFTC to navigate the evolving landscape and take advantage of the regulatory clarity being developed.

Source:

[1] SEC-CFTC Joint Staff Statement (Project Crypto-) (https://www.sec.gov/newsroom/speeches-statements/sec-cftc-project-crypto-090225)

[2] Statement on the Spring 2025 Regulatory Agenda (https://www.sec.gov/newsroom/speeches-statements/atkins-2025-regulatory-agenda-090425)