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CFTC is mulling a cross-border regime that could allow U.S. customers to trade directly on select international crypto exchanges, provided those platforms operate under regulatory standards deemed comparable to American rules.<\/p>\n
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In a recent speech<\/a> before the U.K. All-Party Parliamentary Group on Blockchain Technologies, Acting CFTC Chair Caroline Pham laid out a possible pathway for U.S. oversight of offshore crypto exchanges.<\/p>\n Pham said the agency is weighing whether its long-standing framework for Foreign Boards of Trade could be extended to digital asset platforms. The framework, established in the 1990s to recognize overseas derivatives markets, could open the door for U.S. customers to access certain non-U.S. exchanges if those venues meet regulatory standards comparable to American rules.<\/p>\n \u201cBy using this framework to provide regulatory clarity for non-U.S. exchanges, whether traditional or digital asset markets, that are in jurisdictions with comparable regulatory regimes to the U.S., this is the fastest way that we can legally onshore trading activity efficiently and safely under CFTC regulations and open up U.S. markets to the rest of the world.\u201d Pham said.<\/p>\n<\/blockquote>\n <\/p>\n Acting Chair Pham\u2019s push for this framework is a direct response to what she termed the \u201cdestructive regulation-by-enforcement policy\u201d of the recent past, which she argues crippled domestic innovation and drove talent overseas.<\/p>\n Pham explained that the existing framework for foreign boards of trade provides a durable, flexible, and technology-neutral path to avoid the market fragmentation that plagued post-Dodd-Frank reforms. This approach is central to the CFTC\u2019s broader \u201cCrypto Sprint\u201d initiative, designed to swiftly implement the Trump administration\u2019s pro-innovation crypto roadmap, the acting chair said.<\/p>\n \u201cThat is why I believe that we should use our existing registration categories for brokers, dealers, exchanges, and other market participants because the CFTC\u2019s cross-border approach to foreign markets, products, and intermediaries has been in place for decades,\u201d Pham noted.<\/p>\n<\/blockquote>\n For an EU-based crypto derivatives venue, the CFTC would consider platforms authorized under the Markets in Financial Instruments Directive (MiFID) as a regulated market (RM) or a multilateral trading facility (MTF). These established venues could seek access for U.S. participants under the CFTC\u2019s framework for FBOTs or exempt swap execution facilities (SEFs).<\/p>\n Notably, in a significant expansion, the agency will explore whether trading platforms operating under the EU\u2019s bespoke Markets in Crypto-Assets Regulation (MiCA) could qualify.<\/p>\n Two weeks before Pham\u2019s London remarks, the CFTC issued an advisory<\/a> reaffirming its foreign board of trade regime. That statement was aimed at reversing what Pham called the \u201cenforcement-first\u201d posture of recent years, which has left firms uncertain about where they stand. The Commission\u2019s own enforcement record tells the story.<\/p>\n\n
Why Pham is pushing for the cross-border approach<\/strong><\/h2>\n
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From enforcement-first to proactive recognition<\/strong><\/h2>\n