CFTC Chair Says New Crypto Rulemaking Will Prevent Another FTX-Style Collapse

crypto rulemaking — CFTC Chair Mike Selig has stated that new regulatory rulemaking for crypto exchanges will prevent a repeat of the FTX collapse, arguing that registration with the agency will safeguard spot markets.

Selig made the comments in a Fox Business interview on Wednesday, referencing the 2022 implosion of FTX where over $8 billion in customer funds was stolen. He contrasted that with the safety of funds at FTX’s CFTC-registered subsidiary, which he said were protected by stringent segregation requirements. The CFTC is advancing this rulemaking despite the recent blockage of the Clarity Act by lawmakers.

The agency is proposing a new federal registration category called a “crypto asset market” for exchanges offering leveraged, margined, or financed crypto trades to retail customers. Selig indicated that exchanges offering such products would likely need to register federally, while those not offering leverage could remain under state licenses.

The CFTC is relying on its existing powers to regulate these markets and has opened a public comment period on the proposed framework. Selig, a former SEC crypto task force lawyer, noted that both the CFTC and SEC have adopted a more industry-friendly regulatory posture since the Trump administration took office.