SKN | U.S. Regulator That May Rule Over Digital Assets Pushes Toward Crypto Spot Trading

3 Key Points:

• CFTC Acting Chair Caroline Pham is meeting directly with exchanges to launch regulated crypto spot trading products as soon as next month  even amid the government shutdown.

• The CFTC is forming a new enforcement trial unit and preparing to allow stablecoins as tokenized collateral in 2025, signaling deeper integration of digital assets into U.S. markets.

• Pham’s proactive stance underscores a power shift from the SEC to the CFTC in crypto oversight  potentially redefining the regulatory landscape for U.S. digital assets.

By SKN News

The U.S. Commodity Futures Trading Commission (CFTC) the agency increasingly viewed as the future primary regulator of digital assets  is accelerating plans to introduce crypto spot trading, even without formal Congressional approval.

According to multiple people familiar with the matter, Acting Chairman Caroline Pham has been personally meeting with regulated exchanges to prepare for the rollout of spot crypto contracts as soon as next month. The initiative represents the boldest move yet by a U.S. regulator to bring retail crypto spot trading under a federal framework, bypassing legislative delays caused by the ongoing government shutdown.

CFTC Steps Into Crypto’s Regulatory Void

For years, U.S. lawmakers have debated how to define and regulate crypto assets, but no clear consensus has emerged. In the meantime, the CFTC  traditionally tasked with overseeing commodities and derivatives  is moving ahead under its own authority.

“Even during the shutdown, Pham has been meeting with financial platforms interested in listing spot crypto contracts,” said a person briefed on the matter. “The message is clear  the CFTC believes it already has the tools to regulate this.”

The spot products, which involve direct crypto trading rather than derivatives, could appear first on designated contract markets (DCMs) such as Coinbase, Bitnomial, and prediction-market platforms Kalshi and Polymarket  all of which already operate under CFTC oversight.

“By allowing access to such crypto products on a regulated venue with familiar protections, institutions may finally feel comfortable entering the space,” said Kris Swiatek, a partner at Seward & Kissel advising asset managers on digital assets.

Industry leaders, long frustrated by the SEC’s restrictive posture, are welcoming the move. Cody Carbone, CEO of the Digital Chamber, called the initiative “particularly encouraging,” adding that “agencies must step up where Congress cannot.”

Leveraged Spot Trading and Stablecoin Collateral on Deck

The CFTC’s proposed framework will initially focus on leveraged spot trading — products that allow investors to take positions using margin or financing under full commodities regulation. Analysts say this structure could bring traditional finance safeguards to a market still plagued by opacity and risk.

In parallel, the agency is preparing a policy shift to permit stablecoins as tokenized collateral across U.S. clearinghouses. Sources familiar with the initiative said the program could launch in pilot form by Q2 2025, allowing regulated participants to post stablecoins in place of cash or treasuries  a move Pham has described as a “killer app” for blockchain finance.

Under the pilot, clearinghouses would face enhanced reporting requirements, including large trader disclosures, position transparency, and operational incident reports.

“This could redefine how stablecoins function in global markets,” said Alan Lin, head of digital asset strategy at Hudson Bay Partners. “By institutionalizing stablecoins as collateral, the CFTC is laying the foundation for tokenized finance in the U.S.”

Internal Overhaul and Enforcement Revival

Inside the CFTC, Pham has launched an aggressive restructuring of the agency to modernize its enforcement and operations amid federal staffing cuts. Her plan includes establishing a dedicated trial unit of eight to nine specialized attorneys, many of them former federal prosecutors, to handle complex crypto and derivatives cases.

To stretch the agency’s limited budget, Pham is also exploring regional hiring in lower-cost cities like Kansas City, according to people familiar with the plan.

While these moves have stirred internal friction  with some career staff exiting under voluntary buyout programs  industry observers credit Pham for restoring momentum and direction.

“She’s been laser-focused on making the CFTC the crypto regulator of record,” said Faryar Shirzad, Coinbase’s chief policy officer. “Her team has been unusually open to industry input and dialogue.”

Power Shift Away From the SEC

The CFTC’s expansion into crypto spot markets comes as the SEC’s influence wanes under continued political scrutiny. Even former SEC Chair Paul Atkins, appointed by President Trump, has acknowledged that most digital assets are likely commodities, not securities  placing them squarely within the CFTC’s jurisdiction.

“Market participants have been waiting for clarity, and this may be the CFTC’s moment,” said Rachel Kerr, policy analyst at the Digital Asset Policy Forum. “The ability to trade crypto spot under U.S. law  with leverage and regulated safeguards  would be transformative.”

A growing number of crypto-native firms, including Andreessen Horowitz (a16z) and MoonPay, have backed the CFTC’s approach, calling it a “crucial opportunity” to bring liquidity and legitimacy back onshore after years of offshore dominance.

The Road Ahead: A CFTC-Led Crypto Era?

While Congress has yet to finalize crypto market structure legislation, Pham’s proactive stance may force Washington’s hand. The agency’s confidence in its legal authority  combined with industry cooperation  suggests a regulatory breakthrough is imminent.

Meanwhile, Pham’s future remains uncertain, as she is reportedly set to join MoonPay as Chief Legal Officer once a successor is confirmed. Her exit could delay or accelerate implementation, depending on the timing of the Senate confirmation for her replacement.

But for now, market participants are treating her tenure as a watershed moment.

“Caroline Pham has effectively put the U.S. back in the race for crypto regulation,” said Cody Carbone. “If she delivers even part of this plan before leaving, the balance of power between the SEC and CFTC will never be the same again.”