CFTC Previews Regulation CTX and CAM: A Federal Charter for Crypto Exchanges, With Leverage as the Trigger

On October 5, 2026, the CFTC released an ANPRM previewing two related rules under § 2(c)(2)(D) of the Commodity Exchange Act (CEA). Regulation Crypto Asset Transactions (Regulation CTX) would interpret when that provision applies to crypto, including leveraged spot crypto and spot margin products. Regulation Crypto Asset Markets (Regulation CAM) would create a purpose-built exchange category for those transactions. In remarks the same day, CFTC Chair Michael Selig described the framework as an optional federal path for crypto exchanges, comparing it to the choice between a federal and a state bank charter.

The release follows the Senate’s failure to invoke cloture on the CLARITY Act on September 15, 2026, and the SEC’s August proposal of Regulation Crypto Assets (see our alert, SEC Proposes Regulation Crypto Assets: A Nondilutive Financing Tool). Together, the two agencies are building federal crypto market structure through rulemaking rather than legislation. If adopted, the CFTC’s framework would give exchanges their first defined path to offer margin and leverage on spot crypto to U.S. retail customers.

Leverage Is the On-Ramp

Since the Dodd-Frank Act, § 2(c)(2)(D) of the CEA has required that commodity transactions offered to retail customers on a leveraged, margined, or financed basis must trade on a CFTC-registered exchange, as if they were futures. The main exception is a sale that results in “actual delivery” to the buyer within 28 days. The CFTC takes the view that most crypto assets, other than payment stablecoins issued under the GENIUS Act, can be commodities subject to this provision. The CFTC’s crypto ANPRM calls these retail crypto transactions “crypto asset transactions,” or CTXs.

The CFTC has used this provision to bring enforcement actions against centralized exchanges and DeFi protocols, but it never adopted rules explaining how a crypto exchange could comply. As a result, U.S. retail spot crypto trading developed largely under state money transmission licenses, and leveraged spot crypto trading (often called spot margin) moved offshore. The ANPRM would extend the CFTC’s oversight of these exchanges in two steps. Regulation CTX would define when the statute’s requirements attach. Regulation CAM would create a crypto-specific venue, the CAM, where exchanges could meet the new requirements.

Selig described the resulting structure as a three-rung ladder:

Regulation CTX: When Federal Oversight Attaches

Under Regulation CTX, one offer can cover an entire account. The statute (§ 2(c)(2)(D) of the CEA) reaches transactions offered on a leveraged basis “even if not entered into” on that basis. In the CFTC’s preliminary view, a “covered offer” attaches to every transaction it applies to, “regardless of whether any individual transaction is entered into on one of those bases.” An exchange can make a covered offer through onboarding documents, exchange terms and conditions, or credit and margin documentation, and the offer can cover all transactions on an exchange, in a customer account, or in a product class.

The statute also reaches financing provided by a person “acting in concert” with the exchange, i.e., third-party financing. The CFTC reads that phrase to include financing that the exchange facilitates, arranges, endorses, markets, offers through its own platform, or shares revenue from. The CFTC also asks whether giving customers access to on-chain “vaults” through the exchange’s interface could be a covered offer.

Where a covered offer exists, the CFTC’s preliminary view is that a fully paid trade remains subject to the CEA’s futures-style framework while it “is only recorded on an internal book-entry of the exchange, prior to actual delivery.” Once actual delivery occurs, the CFTC retains only its anti-fraud and anti-manipulation authority over the asset.

Drawing on the Ninth Circuit’s decision in CFTC v. Monex Credit Co., the CFTC’s interpretation of “actual delivery” would require the transfer of “some meaningful degree of possession or control.” For crypto, that “may require possession of the credentials (e.g., private key(s)).” For assets that carry governance or staking rights, it may require the ability to govern “directly and on a disintermediated basis” and to stake “without being subject to fees charged by an intermediary.”

The CFTC’s preliminary understanding is that many on-chain trading protocols already settle in a way that results in actual delivery. In his remarks, Selig summarized the intended rule more simply: Delivery to a user’s external, non-custodial wallet within 28 days should generally satisfy the exception. That emphasis on self-custody is consistent with recent CFTC staff relief for noncustodial wallet interfaces, which we discussed in Wallet to Wall Street: CFTC and SEC Staff Chart Parallel Paths for Noncustodial Crypto Access.

Note that the CFTC withdrew its 2020 interpretive guidance on actual delivery of virtual currency effective December 10, 2025. That guidance had treated delivery to a qualifying depository affiliated with the exchange, subject to specific safeguards, as actual delivery. The Regulation CTX ANPRM does not address that structure.

Regulation CAM: What a Federal Crypto Exchange Would Look Like

Under Regulation CAM, an exchange that offers only CTXs could register as a CAM, conceived as a new type of designated contract market (DCM), by complying with tailored “CAM Core Principles” that implement the statutory DCM core principles. Existing DCMs could instead list CTXs under their current registration.

All CTXs offered through a CAM would be intermediated by an FCM, bringing in the CEA’s customer funds, capital, disclosure, and anti-money laundering requirements. The CFTC is considering modifying those requirements for crypto, including through a limited-purpose FCM registration.

Leverage would only come from eligible providers, meaning that margin or financing would be available only under arrangements listed in the CAM’s rulebook and administered by an FCM or an FCM-sponsored bank, through bilateral financing agreements with individualized terms.

On corporate structure, Regulation CAM makes clear that the FCM does not have to be independent of the exchange. A single firm could register as a CAM, FCM, and DCO, or operate them as affiliates. The CFTC sees potential benefits for customers but asks about conflicts, such as a DCO setting margin levels that drive its affiliates’ revenue.

The CFTC floats factors for deciding whether an asset is too susceptible to manipulation to list, including circulating supply, control of the underlying network, open-source code, and network security. Listings would be supported by “crypto asset disclosures” that are not meant to function like issuer disclosures. The CFTC also asks about forks, network congestion, oracle failures, and proof-of-reserves practices. A de minimis exemption from CAM registration also exists for venues with small CTX trading volume or leveraged notional amounts.

Why It Matters

Under the proposal, U.S. exchanges would be able to offer retail customers margin on spot crypto, letting customers buy and hold spot crypto assets with borrowed funds. That product now lives almost entirely offshore. A CAM could also reduce its state licensing burden: The Money Transmission Modernization Act, which the CFTC notes 31 states have enacted in whole or in part, excludes DCMs and registered FCMs.

Under Regulation CTX, a single “covered offer” of margin or financing can bring every transaction it covers, including fully paid spot trades, under federal regulation. If one covered offer reaches every transaction in an account, an exchange cannot easily run a state-licensed spot business alongside a leverage product for the same customers. Margin clauses in global terms of service, co-branded credit products, and partner lending integrations should be reviewed carefully.

Custodial models face a higher bar than self-custody. The CFTC’s preliminary “actual delivery” test favors customer-controlled wallets. Exchanges that custody customer assets, or stake them for a fee, may find their fully paid book treated as regulated unless they redesign custody and withdrawal flows.

Further, the compliance build is substantial. A CAM needs FCM and DCO functions, in-house or through affiliates or partners, along with capital, segregation, surveillance, and listing controls. The CFTC’s openness to integrated structures may favor platforms that already run custody and clearing functions under one roof.

Open Questions

Several questions remain unanswered by the CFTC’s ANPRM. First, current CFTC rules do not allow a lender to hold a security interest in assets in an FCM’s segregated customer account, which sits uneasily with the contemplated leverage model. The CFTC also asks how customer crypto would be protected in an FCM insolvency if CTXs are not cleared by a DCO, and floats UCC Article 8 as an alternative to the Bankruptcy Code’s commodity broker protections.

The CFTC asks whether the spot leg of a CTX needs traditional clearing by a DCO and whether a DCO could provide a limited guaranty for leveraged positions. Additionally, the Regulation CTX/CAM ANPRM is internally inconsistent on whether an outstanding lien defeats actual delivery. The answer will determine whether on-chain margin protocols with automatic liquidation fall inside or outside the regime.

The ANPRM does not say whether fully paid trades held on an exchange’s internal ledger get the statute’s 28-day actual delivery window. The statute excepts sales that result in actual delivery within 28 days. Selig’s remarks track that window, but the ANPRM’s discussion of fully paid trades does not address it.

Finally, the CFTC asks how to address crypto assets claimed to be securities or investment contracts, and how to treat NFTs. Exchanges will need to align CAM listing decisions with the SEC and CFTC’s joint crypto asset taxonomy and the SEC’s proposed safe harbor.

Next Steps

• Choose a strategic posture. Decide whether to remain state-licensed without leverage, pursue CAM designation, or work with an existing DCM and FCM. The choice affects product design, custody, and entity structure.
• Map custody against the “actual delivery” test. For each asset, confirm who controls the keys, how quickly customers can withdraw to an external wallet, and whether staking and governance rights pass through without intermediary fees.
• Assess state-law exposure. Review state law considerations for a CAM, including preemption.
• Comment. Regulation CTX/CAM ANPRM poses dozens of questions, and the answers will shape any proposed rule. Companies should consider commenting within 60 days of Federal Register publication and coordinating with any comments on Regulation Crypto Assets, which are due October 20, 2026.

Frequently Asked Questions: CFTC Regulation CTX and Regulation CAM

Can a crypto exchange avoid Regulation CAM by not offering leverage?

Yes, in the CFTC’s preliminary view. A spot-only crypto exchange that makes no “covered offer” of margin, leverage, or financing can remain under state money transmission licensing, subject only to the CFTC’s anti-fraud and anti-manipulation authority. But a covered offer is easy to make. Under Regulation CTX, a margin clause in standard customer terms, or financing from a partner “acting in concert” with the exchange, can bring every covered trade under the CFTC’s exchange-trading requirement.

Does the FCM have to be unaffiliated with the exchange?

No. The ANPRM contemplates that a single firm could register as a CAM, FCM, and DCO, or operate all three as affiliates. The CFTC sees potential customer benefits in these integrated structures but asks about conflicts, such as an affiliated DCO setting margin levels that drive its affiliates’ revenue.

Does cold storage count as “actual delivery”?

Not if the exchange holds the keys. The CFTC’s preliminary test for actual delivery under Regulation CTX turns on customer control, including possession of the private keys and, for staking and governance tokens, the ability to use those rights without intermediary fees. Exchange-controlled cold storage likely leaves the trade on the exchange’s internal ledger, and the CFTC has withdrawn the 2020 guidance that treated delivery to an affiliated depository as actual delivery.

Does Regulation CTX apply to institutional customers (eligible contract participants)?

Generally no. Section 2(c)(2)(D) of the Commodity Exchange Act applies to transactions with persons that are not eligible contract participants (ECPs) or eligible commercial entities, so Regulation CTX is a retail regime. Exchanges that serve both retail and institutional customers will need to track which accounts qualify as ECPs.

What happened to the CFTC’s 2020 actual-delivery guidance?

The CFTC withdrew its 2020 interpretive guidance on actual delivery of virtual currency effective December 10, 2025. That guidance had treated delivery to a qualifying depository affiliated with the exchange, subject to specific safeguards, as actual delivery. The Regulation CTX and Regulation CAM ANPRM does not address that structure.

When are comments due?

Comments on the CFTC’s Regulation CTX and Regulation CAM ANPRM are due 60 days after the notice is published in the Federal Register. As of October 8, 2026, the notice has not been published. Separately, comments on the SEC’s proposed Regulation Crypto Assets are due October 20, 2026.