On December 4, 2024, American traders gained access to leveraged spot cryptocurrency trading on federally regulated exchanges, marking a significant milestone for the US crypto industry. The Commodity Futures Trading Commission confirmed that spot crypto contracts will now trade on CFTC-registered futures exchanges, backed by clearinghouse protection against counterparty risk.The decision allows American traders to access margin-based spot crypto trading—a product previously available only on offshore platforms—within the regulated framework of U.S. derivatives markets.Sponsored
Federal Oversight Expands to Spot Crypto MarketsPreviously, Americans looking for leveraged spot crypto had to use offshore platforms, which lacked the protections and transparency of US-registered exchanges. Now, this new framework brings spot crypto trading under the same structure used for futures and options contracts.
“Now, for the first time ever, spot crypto can trade on CFTC-registered exchanges that have been the gold standard for nearly a hundred years, with the customer protections and market integrity that Americans deserve,” Acting CFTC Chairman Caroline Pham said in a statement.
While platforms like Coinbase have long offered spot crypto trading, those services operate without leverage under state-level money transmitter licenses. The CFTC’s move changes the game by enabling margin-based trading under the same federal framework that governs futures and options markets, complete with clearinghouse settlement that eliminates counterparty risk.US derivatives exchange Bitnomial Inc. announced plans to launch a leveraged retail spot crypto exchange under CFTC oversight on December 8.
“Leveraged spot crypto trading is now available under the same regulatory framework as U.S. perpetuals, futures, and options,” Bitnomial founder Luke Hoersten said. “Broker intermediation and clearinghouse net settlement eliminate counterparty risks while providing the capital efficiency traders need.”
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Pham emphasized the importance of offering domestic alternatives to offshore venues. “Recent events on offshore exchanges have shown us how essential it is for Americans to have more choice and access to safe, regulated U.S. markets,” she said.This move closes a longstanding gap in US crypto regulation. Since 2017, futures and options for Bitcoin and Ethereum have been traded on CFTC-registered exchanges, but leveraged spot trading has remained unregulated. Many traders either avoided leverage or assumed the risks of using unregulated foreign services.Clearinghouse protection now lowers counterparty risk for margin-based spot trading, a crucial safeguard absent from many offshore exchanges. Acting as a central intermediary, the clearinghouse guarantees trades even if a party defaults, reducing systemic risk and increasing trust.Sponsored
Legislative Framework Supports Digital Asset GrowthThis regulatory progress coincides with legislative actions to clarify rules for digital assets. The Trump administration championed the GENIUS Act and CLARITY Act to establish tailored regulations for digital assets. The GENIUS Act, signed in July 2025, established the first federal framework for stablecoins, requiring 100% reserve backing and monthly public disclosures.These laws signal a clear shift away from the Biden administration’s focus on fraud and money-laundering controls in crypto. Now, policymakers aim to protect consumers while fostering innovation, positioning the US as a global leader in digital assets rather than pushing the sector offshore.The CFTC has also explored allowing tokenized collateral, such as stablecoins, for derivatives margin requirements. Such integration would allow traders to use digital assets for collateral, not just cash. However, the agency is proceeding carefully, inviting public feedback before making major changes.Sponsored
Despite progress, some consumer advocates express concerns. Advocacy group Better Markets warned of potential confusion among retail investors about which crypto assets and exchanges the new rules cover. They cautioned that unclear guidance could mislead clients on the risks of leveraged crypto trading, especially given the sector’s volatility.Market Implications and OutlookThe introduction of federally regulated leveraged spot trading may shift US trading volumes from offshore to domestic platforms. Offshore exchanges such as Binance, OKX, and Bybit have so far dominated this market. These platforms draw billions of dollars in daily volume from Americans seeking leverage. With CFTC oversight, US-based alternatives may appeal to traders seeking legal certainty and to institutional investors seeking compliance.This regulatory approach brings the credibility and investor safeguards of nearly a century of US financial regulation. CFTC-registered exchanges are subject to established rules on position limits, market manipulation, and client fund protection. These safeguards are critical during periods of market stress. Offshore exchanges, in contrast, have faced liquidity crises and withdrawal freezes.Yet, questions remain about how the new system will work in practice. The CFTC has not announced which cryptocurrencies will qualify for leveraged spot trading or the allowed leverage ratios. These decisions could significantly affect the appeal of domestic products versus offshore platforms, which often offer leverage exceeding 100x on top cryptocurrencies.
