SEC, CFTC Allow Firms to List Certain Spot Crypto Products

Staff of the U.S. Securities and Exchange Commission and U.S. Commodities Futures Trading Commission jointly stated that registered exchanges under their purview can support trading of spot crypto products.

The agencies clarified together that “current law does not prohibit” entities such as designated contract markets, foreign boards of trade and national securities exchanges from listing certain digital asset products.

The SEC’s Division of Trading and Markets and the CFTC’s Division of Market Oversight and Division of Clearing and Risk “will promptly review filings and requests by DCMs, FBOTs, and NSEs seeking to facilitate trading of certain spot crypto asset products,” the staff said.

“This joint statement provides the Divisions’ view that current law does not prohibit SEC- or CFTC-registered exchanges from facilitating trading of these spot crypto asset products,” said the statement.

The statement represents the views of the staff and “has no legal force or effect” like rulemaking or Commission-level guidance, as the agencies made clear in a footnote.

As market participants seek to list spot crypto products, the agencies said they are ready to address questions related to clearing, market surveillance, dissemination of trade data and investor protections.

The coordinated effort comes as part of the agencies’ respective crypto initiatives, which aim to quickly implement recommendations from a White House report aimed at cultivating the digital asset industry. That report directed the SEC and CFTC to work together and use their existing authorities to issue guidance on listing leveraged, margined or financed spot retail commodity crypto transactions.

The joint statement noted that the White House report hoped the divisions would collectively work to create more optionality as consumers choose where to trade. SEC Chairman Paul Atkins said the staff statement is a “significant step forward” in drawing crypto innovation back onshore.

“Market participants should have the freedom to choose where they trade spot crypto assets,” said Atkins. “The SEC is committed to working with the CFTC to ensure that our regulatory frameworks support innovation and competition in these rapidly evolving markets.”

The CFTC’s Crypto Sprint initiative has already issued a staff letter intended to “reaffirm” that offshore crypto entities can use its FBOT registration framework to serve U.S. customers. The CFTC has also requested that crypto stakeholders share feedback on other recommendations within the White House report.

Meanwhile, the SEC has launched its own Project Crypto initiative to craft rules and exemptions for digital assets in line with White House recommendations, and began with staff guidance that put so-called liquid staking beyond its purview earlier this month.