CFTC Chair Selig Says Exchanges Are Seeking Registration Under Agency Crypto Framework as Clarity Act Stalls

Since the Senate blocked the Digital Asset Market Clarity Act in a September procedural vote, the CFTC and the SEC have been building federal crypto rulebooks from authority they already hold. This week, CFTC Chairman Michael Selig said the industry is responding.

Selig told CNBC in an exclusive interview at the Cantor Convergence conference in Miami Beach that major exchanges and new entrants are interested in registering. The interview was published Friday, Nov. 13.

What Selig says the industry wants

Many large crypto exchanges are already registered with the CFTC because they list derivatives such as perpetual futures. Selig said the new framework would let them add spot trading under the same roof.

He also said newcomers are coming. "We're also getting interest from new entrants who say, 'Look, signing up with 50 different state regimes is tough. We'd rather come to one regulator and get a license at the CFTC,'" Selig said.

The agency's October action was an advance notice of proposed rulemaking, a request for public comment rather than a finished rule. It would create a registration category called a "crypto asset market" for platforms offering leveraged, margined or financed trading to retail customers.

Platforms offering basic spot transactions would not have to register and could stay under state oversight. Selig said participation is opt-in for exchanges that do not offer margin, leverage or financing, products he said current state regimes do not allow.

"Our statute does provide for authority of the agencies to register exchanges that want to offer margined, leveraged, or financed crypto assets or other types of commodity trading," Selig said. "So we're utilizing that authority to allow our existing exchanges to begin offering these products under a regulated framework."

A framework built without a new law

Selig framed the move as protection for markets and customers after the Clarity Act failed to reach the president's desk in this Congress. Former CFTC chair J. Christopher Giancarlo has argued the industry can grow without the bill.

But the framework rests on existing statute, not new legislation, and Congress is about to change hands. CNBC reports Democrats are set to control the House and Senate in 2027. Asked how ready he is for more oversight, Selig said, "Congress will do its job investigating where it needs to investigate."

He also said he hopes the country avoids a wave of software developers moving offshore, something many crypto firms threatened during the Biden administration. "I really hope that we learned lessons from the last several years in this space," he said.

The prediction-market front

Selig is fighting a second battle with state governments. According to Crypto Briefing, he has said states should not jail prediction market executives over a dispute about whether event contracts are gambling or derivatives. That outlet reports his sharpest criticism was aimed at Utah, which has pursued criminal actions against Kalshi and its executives.

The disagreement is over who regulates these products. The CFTC treats event contracts as derivatives under exclusive federal oversight. A number of states view them as sports betting, which states have traditionally regulated themselves.

Crypto Briefing reports that Selig has led lawsuits against at least 10 states since taking over the agency, arguing federal authority is exclusive. It also reports that he contends a patchwork of state laws threatens the operational integrity of major exchanges such as the NYSE and CME.

The agency's actions have been aggressive. In July, Crypto Briefing reports, the CFTC invoked emergency authority to direct Kalshi to honor trades in Michigan, despite court orders pointing the other way.

On Nov. 5, Selig issued interpretive guidance requiring designated contract markets to remove geographic access restrictions within 30 days. The guidance says geofencing conflicts with impartial-access rules that require regulated exchanges to treat participants evenly.

That guidance runs against state court orders in places like Michigan and Nevada. Platforms are being told by a federal regulator to open access and by state courts to keep it closed.

The 30-day window from the Nov. 5 guidance runs to roughly Dec. 5. Whether exchanges comply, and how the state courts respond, will test whether the CFTC's reading of exclusive federal jurisdiction holds. Crypto Briefing reports the litigation could escalate to the Supreme Court.