- Mike Selig cited FTX’s $8 billion customer losses as evidence for stronger federal safeguards in crypto markets.
- The CFTC’s proposed framework targets leveraged and margined retail crypto trading, with registration and customer protections.
- Proposed rules include segregated customer funds, proof-of-reserves requirements, anti-manipulation controls and FCM involvement.
CFTC Chairman Mike Selig said crypto markets need federal safeguards that protect customer funds, citing FTX’s 2022 collapse as a warning. Speaking at the Fordham Law Blockchain Regulatory Symposium on Oct. 5, 2026, Selig said the agency wants protections used in federally regulated futures markets for crypto spot trading.
Selig Points to FTX Customer Losses
Selig said FTX showed the damage that can occur when markets lack protections. He said operators stole more than $8 billion in customer funds during the November 2022 collapse. However, Selig pointed to FTX’s CFTC-registered subsidiary as a different case.
He said customer funds there remained safe because the assets were segregated. That experience forms part of Selig’s argument for federal oversight. He said the CFTC has broad authority over crypto exchanges offering margin, leverage or financing.
Those exchanges would have to register with the CFTC. However, Selig described the framework as an opt-in system for exchanges.
CFTC Targets Leveraged Crypto Trading
Many crypto exchanges currently operate under state licensing systems. Selig said some states treat exchanges like money transmitters, including Western Union and PayPal. He said those rules do not fit exchanges that handle financial positions and order books.
The federal framework would apply market-based protections to registered exchanges. The CFTC issued an advance notice of proposed rulemaking on Oct. 5. It outlined Regulation CTX and Regulation CAM for a federal registration category covering crypto asset markets.
The proposals focus on leveraged and margined retail trading. They also include proof-of-reserves requirements and anti-manipulation controls.
New Rules Follow Selig’s Regulatory Path
The proposed frameworks would involve futures commission merchants in retail trades. They would also exempt certain transactions delivering assets to non-custodial wallets within 28 days. Selig has criticized regulation by enforcement and said the Commodity Exchange Act covers certain digital assets.
Bitcoin became a CFTC commodity in 2014 under Chairman Timothy Massad. President Trump nominated Selig on Oct. 27, 2025, and the Senate confirmed him on Dec. 18. Selig took office on Dec. 22, 2025. Following Caroline Pham’s departure, he became the agency’s sole commissioner.
