The CFTC just proposed this fresh federal setup for crypto exchanges pushing leveraged trades to regular retail folks. It could open a clearer lane for US platforms to snag that federal watch, especially with no full crypto market law in sight yet 🖤.
Fresh Rules For Leveraged Crypto Plays🕸️
CFTC boss Michael S. Selig spilled the details on October 5 at the Fordham Law Blockchain Regulatory Symposium in New York. The agency wants feedback on two regs called Regulation Crypto Asset Transactions and Regulation Crypto Asset Markets 💀.
This framework offers exchanges a federal choice without forcing them in. They can still run under state licenses if it fits their vibe. But spots doing certain leveraged crypto trading already hit CFTC registration under old rules anyway.
The CFTC framed the market in three layers. Basic spot exchanges stay mostly under state money rules while keeping anti-fraud powers at the feds. Retail margin or financed trading drops into the middle tier. Derivatives like perps sit at the top. These ideas hit that middle group hardest 🔥.
Exchanges wanting only leveraged crypto deals could register as a crypto asset market or CAM. Regular CFTC derivatives spots could also roll out these products under the new setup. Customer protections would kick in hard with market surveillance plus financial safeguards and rules on holding user funds. They are eyeing proof of reserves too for omnibus accounts 👀.
Futures commission merchants would manage accounts and cash while following existing protections plus AML and ID checks. The CFTC is mulling self custody angles where assets moved to external wallets within 28 days could count as actual delivery.
Onchain Finance Vibes🌑
Selig also touched the agency’s interest in onchain stuff noting devs just shipping software without controlling trades or assets should not get treated as intermediaries automatically.
This does not build a complete federal crypto system alone tho. Congress still needs to hash out if every exchange must go federal.
“The framework I have outlined is an important step towards bringing crypto asset markets within the protections of the CEA. It will establish clear rules of the road for firms that want to serve American customers, strengthen the integrity of these markets, and provide a path for responsible innovation to take place here in America.”
Check the full speech here lmao the whole thing feels like a sinister cute win for defi fr 🚀💸🦇.
Just another echo from the void by iconofsin.eth 💖
