February 2, 2026
Chairman Selig’s Initial Thoughts on Direction for the CFTC in 2026
On Thursday, Jan. 29, Chair of the Commodity Futures Trading Commission, Michael S. Selig, outlined CFTC priorities for 2026 and beyond. With Securities Exchange Commission Chair Paul Atkins at his side, Selig discussed how the CFTC would partner with the SEC on Project Crypto. He also noted that he has already directed CFTC staff to begin upgrading CFTC regulations and that he looked forward to leading the CFTC into a new era of modernization, harmonization, and future-proofing regulations.
Such regulations should bring important clarity and guideposts for CFTC enforcement efforts, including the Commission’s Whistleblower Program.
Below are a few takeaways directly from Chairman Selig’s speech:
A Tradition of Market Innovation
Today, commodity markets are experiencing a period of rapid transformation. Blockchains, crypto assets, and smart contracts are introducing new methods for trading, clearing, settling, margining, and collateralizing commodity price exposures. These innovations have the potential to reduce operational frictions by enhancing liquidity and streamlining post-trade processes. At the same time, new products such as prediction markets, “mini” contracts, and perpetual futures have experienced rapid adoption.
- Direction: The CFTC is positioning itself to build on its historic role as a forward-looking regulator. By applying clear rules, principles-based oversight, and harmonizing with fellow regulators, like the SEC, the Commission’s objective is to help ensure that the next generation of commodity markets develop onshore—continuing a legacy that stretches from the grain pits of Chicago to the digital markets of the future.
The Crypto Capital of the World
America is home to the most transparent and well-regulated financial markets in the world. With thoughtful engagement and a commitment to principled innovation, the U.S. is uniquely positioned to extend its preeminence into the crypto era.
The GENIUS Act is law and Congress is on the cusp of passing market structure legislation.
Therefore, America’s financial regulators, like the CFTC, must modernize and harmonize their approach to regulation to future-proof our markets for the innovations of tomorrow.
- Direction: CFTC staff will make full use of the agency’s existing authorities to begin upgrading our regulations for America’s Golden Age.
Project Crypto: Modernizing and Harmonizing Financial Regulation
The CFTC is partnering with the SEC on Project Crypto—bringing coordination, coherence, and a unified approach to the federal oversight of crypto asset markets.
Project Crypto recognizes that crypto markets span across agencies’ respective regulatory boundaries. Therefore, the agencies will collaborate on developing clear, durable, rules these markets that will:
- Advance a clear crypto asset taxonomy,
- Clarify jurisdictional lines,
- Remove duplicative compliance requirements, and
- Reduce regulatory fragmentation
Ensuring that innovation takes root on American soil, under American law, and in service of American investors, customers, and businesses.
New Accord: Delivering Clarity and Certainty to Crypto Asset Markets
With a wide range of new crypto assets and on-chain financial markets, we’re due for a new cross-agency agreement to govern these markets.
SEC Chairman Atkins recently laid out a common-sense crypto asset taxonomy that would make clear that digital commodities, digital collectibles, and digital tools are not “securities”—even when they are sold as part of an investment contract.
- Direction: CFTC staff will work with SEC staff to consider joint codification of this framework as an interim measure while Congress finalizes legislation.
Expanding Eligible Tokenized Collateral
With a clearer taxonomy in place, the next question becomes how blockchain technologies can be harnessed to strengthen market resilience and market functions.
In certain markets, 24/7 trading offers meaningful advantages, particularly where global participation is essential to market efficiency.
- Direction: CFTC staff will develop rules to enable the responsible deployment of additional forms of eligible tokenized collateral.
Onshoring True Perpetual Derivatives
The pace of innovation with crypto assets has also led to experimentation with novel types of derivatives, such as “perpetual contracts,” i.e., derivatives with no fixed maturity date.
- Direction: The CFTC will use the tools at its disposal to onshore perpetual and other novel derivative products so that they can flourish across both centralized and decentralized markets, subject to appropriate safeguards.
Safe Harbors for Software Developers and Users
Digital wallets, decentralized finance protocols, layer-2 networks, and other on-chain software systems are now part of everyday finance. However, uncertainty persists regarding the appropriate regulatory treatment of these technologies under the CFTC’s existing framework.
- Direction: The CFTC will explore ways in which the agency can encourage innovation in software development and support builders as they work toward product market fit, including by assessing whether an innovation exemption may be appropriate in certain circumstances.
At every step, the CFTC’s actions will reflect a commitment to establish clear and unambiguous safe harbors for software developers to ensure that the crypto innovations of today and tomorrow are Made in America.
Leveraged Crypto Asset Trading
Intermediated trading will continue to play an important role in crypto markets. That includes trading conducted both on- and off-exchange with leverage, margin, or financing. The CFTC is taking concrete steps to foster these trading activities, including:
- CFTC staff will begin drafting rules clarifying when leveraged, margined, or financed retail commodity transactions in crypto may be offered off-exchange under an “actual delivery” exception.
- CFTC staff will begin drafting rules codifying requirements for “designated contract markets” (DCMs) that choose to offer these transactions on their current platforms. Codification should promote consistency, transparency, and a uniform application of core protections across venues—hallmarks of the CFTC’s regulatory regime.
- CFTC staff will explore the creation of a new category of DCM registration that is tailored specifically to retail leveraged, margined, or financed crypto asset trading. These venues would perform functions similar to traditional DCMs but operate under a purpose-fit regulatory framework.
Facilitating Substituted Compliance and Super-Apps
The CFTC will work closely with the SEC to identify opportunities to better align regulatory requirements across markets.
- Objective: The objective is to reduce unnecessary duplication that does not improve market integrity. Within the bounds of the law and where appropriate, market participants should be able to offer multiple products through a single platform without navigating an inefficient patchwork of registrations and overlapping regulatory regimes.
Prediction Markets
The CFTC supports lawful innovation of prediction markets, otherwise known as event contracts, and the important role they play in the broader financial system. Here’s how we will be moving forward to give them more certainty.
- CFTC staff will withdraw the 2024 event contracts rule proposal that would prohibit political and sports-related event contracts and the 2025 staff advisory (No. 25 – 36), which cautioned registrants about offering access to sports-related event contracts due to ongoing litigation.
- CFTC staff will move forward with drafting an event contracts rulemaking.
- CFTC staff will reassess the Commission’s participation in matters currently pending before the federal district and circuit courts.
CFTC staff will work with counterparts at the SEC to develop a joint interpretation on definitions of the Title VII Dodd-Frank Wall Street Reform and Consumer Protection Act. This effort would draw clearer lines between certain commodity and security options, CFTC-regulated swaps, and SEC-regulated security-based swaps.
The Role of Whistleblowers
Whistleblowers play a critical role in ensuring the integrity of the U.S. and global financial markets. Both the SEC and CFTC rely on whistleblowers to help them enforce violations of the federal securities laws and the Commodity Exchange Act. If you have witnessed fraud, consider blowing the whistle.
What to Do if You Have Witnessed Fraud:
- Speak with an Experienced Whistleblower Attorney: Contact an experienced whistleblower attorney who understands the SEC and CFTC whistleblower programs. These consultations at Cohen Milstein are confidential and free of charge. Counsel can guide you through the process and assist in preparing and submitting your Tip, Complaint, and Referral (Form TCR) to the SEC or CFTC.
- Gather Your Information: Along with your personal observations and a completed Form TCR, the SEC and CFTC requires supporting information that is original and not in the public sphere.
- Understand the Potential for a Whistleblower Award: If your information leads to a successful SEC or CFTC enforcement action resulting in more than $1 million in monetary sanctions, you may receive an award ranging from 10-30% of any amount collected.
The SEC’s Whistleblower Program and the CFTC’s Whistleblower Program provide comprehensive guidelines on reporting fraud and the whistleblower process. Access the Tip, Complaint or Referral (TCR) forms: SEC Form TCR and the CFTC Form TCR.
About the Author
Christina McGlosson, special counsel in Cohen Milstein’s Whistleblower practice, focuses exclusively on Dodd-Frank Whistleblower representation. She is the former acting director of the Whistleblower Office in the Division of Enforcement at the U.S. Commodity Futures Trading Commission. She was a senior attorney in the SEC’s Division of Enforcement, where she assisted in drafting the SEC rules to implement the whistleblower provisions of Dodd-Frank and served as Senior Counsel to the Director of the SEC’s Division of Enforcement and to its Chief Economist.
Christina represents whistleblowers in the presentation and prosecution of fraud claims before the SEC, CFTC, FinCEN, as part of the U.S. Treasury, the Department of Justice, and other government agencies.