U.S. Regulators Permit Spot Crypto Trading, Ending Years of Ambiguity

The U.S. Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) have issued a joint statement affirming that registered exchanges are permitted to list and facilitate spot crypto asset products, marking a pivotal shift in regulatory clarity for the digital asset sector. The statement, released on September 2, 2025, clarifies that national securities exchanges (NSEs), designated contract markets (DCMs), and foreign boards of trade (FBOTs) may legally trade certain spot crypto assets under existing rules. This development follows years of ambiguity, during which exchanges operated in a gray area regarding the permissibility of spot crypto trading, particularly for leveraged or margined products .

The joint guidance, issued by staff from the SEC’s Division of Trading and Markets and the CFTC’s Divisions of Market Oversight and Clearing and Risk, emphasizes that existing regulatory frameworks do not prohibit spot crypto trading on registered exchanges. It aligns with broader initiatives—Project Crypto by the SEC and Crypto Sprint by the CFTC—to modernize digital asset regulations and position the U.S. as a global leader in crypto innovation. SEC Chair Paul Atkins highlighted that the move “ends the era of uncertainty,” enabling exchanges to operate without fear of regulatory overreach, provided they comply with standards for clearing, surveillance, and investor protection .

The announcement coincides with the SEC’s launch of “Project Crypto,” a multi-faceted effort to adapt securities laws for blockchain-based markets. The initiative aims to address challenges posed by tokenization and decentralized finance (DeFi) while fostering innovation. Atkins emphasized that the SEC would “update antiquated rules” to leverage on-chain systems, which reduce intermediation in traditional markets. This includes streamlining licensing for “super apps” like Coinbase’s recent product, which bundle financial services into single platforms .

Market participants have responded cautiously optimistic, with analysts noting that the joint statement could catalyze institutional participation in crypto markets. Over 90 spot crypto ETF applications are pending with the SEC, and the regulatory green light may accelerate their approval. The move also aligns with the Trump administration’s broader pro-crypto agenda, which includes legislative efforts like the CLARITY Act and GENIUS Act to standardize digital asset regulations .

However, the legal landscape remains contentious. Five key cases are poised to reshape the regulatory framework for digital assets. The Second Circuit’s review of SEC v. Ripple Labs and SEC v. Coinbase will determine how the Howey test—a framework for identifying securities—applies to crypto transactions. Meanwhile, industry-led lawsuits, such as Blockchain Association v. IRS and Bitnomial Exchange v. SEC, challenge the scope of federal oversight over decentralized finance and futures markets. These cases could redefine the boundaries of SEC and CFTC authority, with outcomes potentially impacting the viability of DeFi platforms and futures exchanges .

The joint statement also underscores the agencies’ commitment to collaboration, with plans for a joint roundtable on September 29, 2025, to discuss regulatory harmonization. Topics include DeFi, perpetual contracts, and market surveillance. The CFTC’s Acting Chair Caroline Pham noted that the “wave of innovation” in crypto depends on coordinated efforts to balance investor protection with market growth .

[1] SEC and CFTC Staff Issue Joint Statement on Trading of Certain Spot Crypto Asset Products (https://www.sec.gov/newsroom/press-releases/2025-110-sec-cftc-staff-issue-joint-statement-trading-certain-spot-crypto-asset-products)

[2] SEC debuts ‘Project Crypto’ to bring U.S. financial markets on-chain - CNBC (https://www.cnbc.com/2025/07/31/sec-debuts-project-crypto-to-bring-us-financial-markets-on-chain.html?msockid=12b65ae36d49622c0a454c976cd8635d)

[3] A Regulatory Turning Point: What the SEC and CFTC’s Green Light Means for Spot Crypto Trading in the U.S. (https://blockchain.bakermckenzie.com/2025/09/15/a-regulatory-turning-point-what-the-sec-and-cftcs-green-light-means-for-spot-crypto-trading-in-the-u-s)

[4] Crypto in the Courts: Five Cases Reshaping Digital Asset Regulation in 2025 (https://katten.com/crypto-in-the-courts-five-cases-reshaping-digital-asset-regulation-in-2025)