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The US Commodity Futures Trading Commission (CFTC) has opened a path for some offshore crypto exchanges to re-enter the American market under its Foreign Board of Trade (FBOT) framework, clearing the way for firms including Binance and ByBit to service local investors.
Acting CFTC Chair Caroline Pham said in an Aug. 28 statement that the move “provides the regulatory clarity needed to legally onshore trading activity” after what she called an era of “unprecedented regulation by enforcement.”
She added that US traders will once again have “choice and access to the deepest and most liquid global markets” in digital assets.
Pham also welcomed back American companies that were forced to set up shop overseas.
“Starting now, the CFTC welcomes back Americans that want to trade efficiently and safely under CFTC regulations, and opens up US markets to the rest of the world,” she said. “It’s just another example of how the CFTC will continue to deliver wins for President Trump as part of our crypto sprint.”
Over the past few years, offshore exchanges were “driven out of the United States,” Pham said. This has forced exchange platforms, such as Binance, to explore alternative avenues to gain access to the US market.
The exchange ended up servicing US traders through a separate entity called Binance.US, a platform that is still not available in all states.
Regardless of the restrictions, Binance remains the largest crypto exchange platform in the world in terms of trading volume. Data from CoinMarketCap shows the exchange’s 24-hour volumes are currently above $23 billion.
The next biggest crypto exchange by trading volume is ByBit, another off-shore platform with more than $4 billion in 24-hour trading volume.
ByBit was blocked from operating in the US back in 2021 due to regulatory issues that included insufficient KYC procedures.
The CFTC’s new pathway will address the restrictions that those platforms and others have had to deal with over the past few years. This could potentially lead to increased volumes on popular exchanges that are headquartered outside of the US, especially as the Donald Trump Administration forges ahead with its pro-crypto policy.
During his election campaign last year, Trump made a series of promises to the crypto community, which was facing a regulatory onslaught from rhe US Securities and Exchange Commission (SEC) and its former Chair, Gary Gensler.
Since taking the White House in January, Trump has started delivering on several of his promises. In the same month as his inauguration, the US President signed an executive order endorsing the “responsible growth and use of digital assets, blockchain technology, and related technologies.”
Congress also passed the GENIUS Stablecoin Act, a key bill that establishes the guidelines for stablecoin issuers in the US. Many have seen the move as a step in the right direction towards giving the Web3 industry the regulatory clarity it has been asking for over the years.
The Trump Administration also dismantled a crypto enforcement unit within the US Justice Department, as well as eased enforcement and appointed more crypto-friendly leadership across numerous regulatory agencies, including the SEC.
In July, the President’s crypto working group also released a report laying out a roadmap for Trump’s mission to make the US the “crypto capital of the world.”
A total of 18 recommendations were made to the CFTC, two of which are concerned with the agency directly. The remaining recommendations concerning the CFTC involved other agencies such as the SEC and US Treasury.
That led to the CFTC launching an aggressive “Crypto Sprint” initiative at the start of the month, which acts on the guidance received from the White House.
The initiative has two phases and is designed to rapidly roll out rules for cryptos and other digital assets. As part of the initiative, the CFTC moved forward to allow spot trading of digital assets on registered futures exchanges, and recently started “stakeholder engagement” on all of the recommendations made in the White House’s report.
“The Trump Administration has ushered in a new dawn for crypto, and it’s up to market participants to seize this opportunity to be a part of the Golden Age of innovation,” Pham said in an Aug. 21 statement.
Read more on InsideBitcoins.com
