CFTC Crypto Leverage Rules Target Offshore Perpetuals, Not Spot

The Commodity Futures Trading Commission has taken its first formal step toward writing crypto-specific rules. The focus is narrow: retail trading done with borrowed money. On Monday the agency published an advance notice of proposed rulemaking for two frameworks, Regulation Crypto Asset Transactions (Regulation CTX) and Regulation Crypto Asset Markets (Regulation CAM). The public gets 60 days to comment once the notice appears in the Federal Register. 1

The scope is the real story. The rules would govern retail crypto trades conducted on a margined, leveraged or financed basis. Ordinary spot buying and selling stays largely under state oversight. 14

What the CFTC is actually proposing

The legal hook is not new. Under the Commodity Exchange Act, leveraged retail commodity transactions already have to run through CFTC-registered exchanges. 1 What the agency is adding is a workable structure for crypto venues that want to offer those products.

Regulation CAM would create a new, optional federal registration category. CoinDesk describes it as a narrow, crypto-focused version of the designated contract markets (DCMs) the CFTC already regulates. 4 Venues could choose that path or register as a traditional DCM. 3 Digital Today reports that the notice also covers:

• delivery exceptions, which determine when a leveraged trade counts as "actually delivered" and falls outside CFTC jurisdiction
• reserve requirements
• customer asset protections 3

This is an advance notice, not a draft rule. The CFTC is asking questions before committing to specific text. Several outlets describe the move as "proposing" rules, but formal proposals and final rules would still have to follow. 34

The offshore market in the crosshairs

Forbes frames the effort as an attempt to bring a large offshore business under federal supervision. 2 Much leveraged crypto trading happens through perpetual futures. These are derivatives that track an asset's price, have no expiry date and don't require the trader to own the underlying token. 2 Perpetuals volume topped $60 trillion in 2025, with as much as $200 billion changing hands on a given day. 2 Offshore venues such as OKX and Bybit often let non-U.S. customers trade them at up to 100x leverage on tokens like bitcoin and solana. 2

Americans are not entirely shut out. Coinbase and Kraken already offer regulated perpetual-style products domestically. 2 The gap Forbes identifies is different: buying the crypto asset itself with borrowed money has lacked a clear federal route. 2 Chairman Michael Selig's framework is pitched as giving U.S. exchanges that route. 2

The headline volume figure deserves some caution. The $60 trillion mostly reflects offshore derivatives activity. A rule enabling leveraged spot-style purchases on U.S. platforms will not automatically pull that volume onshore, especially if American venues end up with leverage limits far below 100x. Whether the rules are competitive enough to attract traders is an open question the comment period will likely test.

Why the CFTC is acting now

The sources agree that Congress's failure is the backdrop. Digital Today says the CLARITY Act, the crypto market structure bill, has failed, prompting the CFTC to use its existing authority instead. 3 CoinDesk similarly describes the rules as an attempt to resolve uncertainty left by lawmakers' inability to pass a crypto law. 4 The CFTC is also following the Securities and Exchange Commission under Paul Atkins, which has already put forward its own crypto proposals. 4

This creates an awkward split. Each regulator is building out the parts of the market its existing statutes reach. Neither can fully cover the territory a market structure law would have assigned.

The spot-market gap

CoinDesk's framing is the most skeptical: the rules cover "the waterfront" of crypto activity except simple, direct trading. 4 That exception matters. Plain spot purchases on unleveraged platforms are the most common way retail users interact with crypto. Under this plan they would remain governed by a patchwork of state money-transmitter and licensing regimes. 1

The CFTC's choice is a legal necessity, not an oversight. Without new legislation, its authority over retail crypto runs mainly through leverage, margin and financing. Rules built on that foundation can be ambitious within their lane, but they cannot create a unified federal spot regime.

The reading

This is a meaningful but bounded move. It shows the CFTC intends to compete for, and supervise, leveraged retail crypto activity that has mostly lived offshore. The optional CAM registration gives exchanges an incentive rather than a mandate. Optional, self-selected frameworks tend to succeed only if their requirements are lighter or clearer than the alternatives, so how those terms are drawn will be decisive.

The effort also has limits. It is at the earliest rulemaking stage and depends on agency authority rather than statute. That leaves it exposed to legal challenge and to changes in agency leadership. And it leaves the biggest structural question in U.S. crypto regulation, who oversees spot markets, exactly where Congress left it.