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Senate Draft Hands Crypto Spot Oversight to CFTC as Regulator Targets December Launch of Leveraged Trading

The bipartisan proposal defines digital commodities with new registration and custody rules, leaving DeFi and AML sections open.

Overview

  • Acting CFTC Chair Caroline Pham said she expects leveraged spot crypto products to begin trading before year’s end using existing Commodity Exchange Act authority.
  • The agency has held talks with designated contract markets including CME, Cboe Futures Exchange, ICE Futures, and Coinbase Derivatives to list leveraged spot offerings.
  • The Senate Agriculture Committee’s discussion draft would give the CFTC explicit authority over most spot trading in digital commodities such as Bitcoin and other non-security tokens.
  • The bill outlines registration for exchanges, brokers, and dealers with requirements for customer fund segregation, disclosures, conflict-of-interest safeguards, and dispute-resolution processes.
  • Key issues remain unsettled including treatment of DeFi, anti-money-laundering obligations, and exemptions, as lawmakers flag CFTC staffing needs while nominee Mike Selig awaits Senate confirmation.