- CFTC clarifies FBOT rules, giving non-US exchanges legal access to American traders.
- Advisory restores clarity, opening US markets while ensuring regulatory oversight.
- The shift signals a Trump-era push for clear crypto, derivatives, and DeFi regulations.
The Division of Market Oversight of the Commodity Futures Trading Commission (CFTC) issued an advisory on August 28 to clarify the foreign board of trade (FBOT) registration framework. The advisory had set the terms for non-US exchanges proposing to offer direct market access to American traders.
The framework applies to all asset classes, including traditional derivatives and digital assets. It offers offshore trading platforms guidance on registration by the CFTC and operating business under the regulatory supervision of the US. The shift follows years of uncertainty, during which most exchanges blocked US users or relocated to other countries to avoid enforcement activities.
Acting Chairman Caroline D. Pham stated that the advisory aims to restore clarity and create a path for global trading venues to return to US markets. She further stated that Americans are being welcomed back to trade efficiently and safely under the CFTC regulations. Also, she reiterated that the US markets are being opened to the rest of the world.
FBOT Advisory Restores Legal Access to US Crypto Markets
The guidance reaffirms a framework that has existed since the 1990s, allowing Americans to trade on foreign exchanges that register as FBOTs. However, in recent years, disruptions have resulted from confusion over the status of non-US exchanges and whether they should register as designated contract markets (DCMs) or foreign board of trade (FBOTs).
The CFTC clarified that FBOT registration is enough for exchanges outside the US. This may allow platforms like Binance and other international firms to legally operate in the US, as long as they follow supervisory and information-sharing standards.
The advisory also covers the additional inquiries that the Division of Market Oversight received as global derivatives markets extended to new products and asset classes. The agency pointed out that recent enforcement activities had been confusing, applying new interpretations that were not in line with decades of regulatory practice.
CFTC Guidance Extends to Crypto and Derivatives Trading
The FBOT advisory applies universally, meaning that foreign exchanges trading digital assets are subject to the same regulations as those trading traditional derivatives.
Registered FBOTs may provide access to eligible US participants, such as proprietary traders and intermediaries, including futures commission merchants.
All trades need to be cleared by CFTC-registered entities or by exempt firms that comply and protect customers. The guidance allows American traders to access deeper pools of liquidity while keeping trading activity under regulatory oversight.
Pham noted that the advisory supports President Donald Trump’s broader digital asset strategy, referred to as the “crypto sprint.” The initiative, launched earlier this month, focuses on providing clear rules for crypto commodities, decentralized finance, and blockchain-based derivatives.
Related: CFTC Adopts Nasdaq Market Surveillance Tech to Widen Crypto Oversight
FBOT Advisory Signals Regulatory Shift Under Trump Era
The explanation departs from the enforcement-based policy that characterized the former administration. Under President Joe Biden, the CFTC has had enforcement initiatives against several crypto platforms, such as a 2023 case against Binance for failing to register as a DCM.
Since Trump assumed office in January 2025, regulators have embraced a more formal approach to digital assets. Earlier, the CFTC stated it was integrating Nasdaq’s surveillance technology to enhance oversight of crypto and derivatives trading.
The reaffirmation of the FBOT registration model highlights the agency’s aim to give certainty to global exchanges and to have transparent and enforceable rules that the US traders will be subject to. The step is also indicative of an attempt to balance market innovation with regulatory protection as the adoption of crypto grows globally.
