On 28 August 2025, the United States Commodity Futures Trading Commission (US CFTC) issued an advisory through its Division of Market Oversight clarifying the registration framework for foreign boards of trade (FBOTs). The advisory applies to non-U.S. exchanges that wish to provide direct market access to participants located in the United States. It reaffirms that the FBOT registration process covers all asset classes, including traditional derivatives and crypto asset markets, and is intended to restore regulatory certainty following recent enforcement-related confusion.
US CFTC Guidance on Scope of FBOT Advisory
The US CFTC confirmed that FBOT registration is the appropriate route for non-U.S. exchanges legally organised and operating outside the United States that provide American traders with direct access to their platforms. This longstanding framework, first introduced in the 1990s, remains the cornerstone of cross-border access to global markets. Unlike a designated contract market (DCM), which is a U.S.-based exchange, FBOT registration allows foreign venues to operate under CFTC oversight without relocating their infrastructure.
Statements from US CFTC Acting Chairman Caroline Pham
US CFTC Acting Chairman Caroline D. Pham welcomed the advisory, stating: “Today’s FBOT advisory provides the regulatory clarity needed to legally onshore trading activity that was driven out of the United States due to the unprecedented regulation by enforcement approach of the past several years.” Her remarks emphasised that American companies which had shifted operations abroad to facilitate crypto trading now have a clear legal path to return. She further noted: “Starting now, the CFTC welcomes back Americans that want to trade efficiently and safely under CFTC regulations, and opens up U.S. markets to the rest of the world.” Simplified, Pham’s message is that the CFTC wants to give U.S. traders secure access to global markets while ensuring that foreign exchanges can engage with U.S. participants under a predictable registration system.
Restoring Confidence After Market Confusion
The US CFTC acknowledged that recent enforcement actions created uncertainty over whether certain non-U.S. exchanges should register as DCMs or as FBOTs. These actions were based on novel interpretations that diverged from decades of regulatory practice, leaving market participants uncertain. By issuing this advisory, the US CFTC is reaffirming that FBOT registration is the correct and established pathway, providing clarity and reducing disruption in cross-border derivatives and crypto trading.
Impact on Global Derivatives and Crypto Markets
The advisory is expected to have significant implications for global trading. For U.S. traders, it restores access to the world’s deepest and most liquid derivatives markets while ensuring that trades are conducted under the protections of CFTC oversight. For non-U.S. exchanges, it provides a reaffirmed route to serve American participants without facing inconsistent interpretations of U.S. securities and commodities law. US CFTC Acting Chairman Pham linked the development to the regulator’s broader “crypto sprint,” a strategic effort to integrate digital asset markets into existing regulatory frameworks while supporting innovation.
(Source: https://www.cftc.gov/PressRoom/PressReleases/9111-25)
