CFTC: Regulate Like It’s 2015! 🚀

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Law and Ledger is a news segment focusing on crypto legal news, brought to you by Kelman Law – A law firm focused on digital asset commerce.

The following opinion editorial was written by Alex Forehand and Michael Handelsman for Kelman.Law.

CFTC Outlines How Present Regulations Cover Digital Assets

In her remarks before the UK All-Party Parliamentary Group on Blockchain Technology on September 8, 2025, acting CFTC Chairman Caroline D. Pham waxed poetic about everything from broad principles to targeted chaos. Framing the urgency that followed the President’s Working Group’s foundational report, Pham declared war on reinvention, insisting regulators need not “reinvent the wheel”-a phrase that made one wonder if her wheel had ever left the garage.

The first concrete initiative? The CFTC’s Crypto Sprint, a bureaucratic footrace to regulatory clarity. Public consultations now sprint toward October 20, 2025, with comment deadlines. Commissioner Pham, ever the impatient host, insists simplicity and timeliness can’t wait years-unless you count the 30 years Dodd-Frank has been rotting in the regulatory attic.

Complementing this, the CFTC and SEC issued a joint staff statement asserting that current U.S. law permits registered exchanges to trade spot crypto. In essence, digital assets are now “inside our existing regulatory perimeter”-a phrase that sounds like a bureaucratic exorcism. Investor protections? Decades of built-in integrity! Or, as Pham might say, “Trust us, we’ve had this since the Stone Age.”

The primary measure Pham revealed? A love letter to cross-border frameworks. By utilizing mechanisms like substituted compliance and mutual recognition-tools older than your grandmother’s knitting-Pham aims to onshore non-U.S. trading venues. Imagine, if you will, a bureaucratic VHS tape playing on a digital blockchain.

This is followed by a recent CFTC advisory reaffirming registration frameworks for foreign boards of trade (FBOTs), structures from the 1990s now “extended with clarity” to digital-asset markets. Pham, ever the optimist, claims this avoids delay and fragmentation-though the FBOTs might argue they’re just being resurrected from a regulatory crypt.

Pham cited the EU’s MiCA framework as a shining example of how existing international standards can be harnessed rather than duplicated. She noted that MiCA provides a “comprehensive baseline” for oversight, while U.S. regulators should “look to mechanisms like substituted compliance”-a phrase that makes one crave a stiff drink and a nap.

By referencing MiCA, Pham underscored that the U.S. need not “reinvent the wheel”-a wheel that, by the way, is already rusted and missing a spoke. Instead, she suggested leveraging regimes to import safeguards, harmonize supervision, and avoid regulatory arbitrage. A masterstroke! Unless, of course, the wheel collapses under its own weight. 🤷

Old Frameworks v. New Technology

This strategy raises an essential question: should regulators adapt existing tools for digital assets, or does novel technology demand new regulation? A philosophical debate as thrilling as watching paint dry, but hey, at least the paint has blockchain now.

On the one hand, using fragmented, technology-neutral tools might overlook blockchain’s vulnerabilities-like smart contracts that are more “smart” than “contracts.” It might also fail to capture the custodial distinctions between centralized intermediaries and decentralized arrangements, which sounds like a joke only a regulator could laugh at.

On the other hand, the existing frameworks are cross-border regimes that import digital-asset regulations from abroad. In effect, the U.S. is adopting frameworks developed by others, like MiCA. A regulatory version of “borrowing someone else’s homework”-but with more legalese and fewer doodles.

This cross-pollination ensures that blockchain’s unique features-immutability, decentralized custody-are not overlooked. Utilizing known statutes allows regulators to act quickly, which Pham frames as necessary to avoid ceding innovation to other jurisdictions. A noble goal, unless you’re the jurisdiction ceding it. 🤡

Yet, this direction should not be read as a rejection of future regulation. Rather, it’s a two-stage strategy: first, corral digital assets within known frameworks; second, monitor, learn, and refine. A bureaucratic game of whack-a-mole, but with more spreadsheets and fewer moles.

Notably, the SEC and CFTC have announced plans to host a joint roundtable in late September. Cue the jazz hands and regulatory hot takes. The idea that this is only a temporary fix is reinforced by public consultations with comment deadlines set for October 20, 2025. A temporary fix? More like a temporary bridge to nowhere. 🌉

Pham’s address to the U.K.’s All-Party Parliamentary Group on Blockchain Technologies-spanning the Crypto Sprint, joint regulatory clarity with SEC, leveraging FBOT regimes, and cross-border coordination-demonstrates a deliberate emphasis on using what we already have. Her refrain about not “reinventing the wheel” is a phrase we can all understand, especially if the wheel is a bureaucratic relic.

It’s clear this path offers immediate benefits: preserving investor protections and legal clarity while avoiding unnecessary delays. However, counsel and market participants should remain vigilant. As digital-asset ecosystems evolve-from programmable finance to decentralized governance-the regulatory architecture must be ready to evolve in kind. Or, as Pham might say, “Keep your eyes on the wheel, even if it’s falling apart.”

Kelman PLLC continues to monitor developments in crypto regulation across jurisdictions and is available to advise clients navigating these evolving legal landscapes. For more information or to schedule a consultation, please contact us here.

This article originally appeared at Kelman.law.

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2025-09-13 15:14