US Regulators Propose 24/7 Trading and Enhanced Crypto Derivatives Oversight
The US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) issued a joint statement on Friday addressing the potential transition to round-the-clock capital markets and advancing regulatory frameworks for crypto derivatives.
Highlighting the necessity for a 24/7 trading environment to support scalable onchain finance, the agencies noted that extending trading hours could better synchronize US markets with the realities of a global, always-on economy. However, they acknowledged that such expansion may not suit all asset classes, cautioning against a uniform approach across products.
The regulators prioritized clarifying rules for event contracts and perpetual futures—contracts without expiration dates—reflecting the growing complexity of crypto derivatives. While continuous trading could accelerate capital flow, it also raises risks for market participants, exposing positions to potential overnight volatility influenced by global time zones.
This initiative builds upon the Trump administration’s 2020 crypto report, which recommended interagency cooperation between the SEC and CFTC to establish a comprehensive regulatory framework for digital assets. The report assigned the CFTC authority over spot crypto markets and the SEC oversight of tokenized securities.
Further, in August, the CFTC introduced the Foreign Board of Trade (FBOT) framework, permitting regulated offshore exchanges across asset classes to obtain licenses to operate in the US market, enhancing cross-border market integration.
Complementing these regulatory efforts, there is a growing emphasis on developing quantum-resistant cryptographic architectures to safeguard digital financial systems against future threats posed by quantum computing. The SEC’s Crypto Assets Task Force is currently reviewing proposals aiming to quantum-proof digital assets ahead of potential vulnerabilities in existing encryption standards.
FinOracleAI — Market View
The joint SEC and CFTC statement signals a forward-looking regulatory approach aligning US capital markets with global trading realities and the expanding digital asset ecosystem. The prospect of 24/7 trading could increase market liquidity and capital velocity but also introduces heightened overnight risk, which may require new risk management tools and investor protections. Regulatory clarity on crypto derivatives and offshore exchange licensing under the FBOT framework can foster innovation while mitigating systemic risks. However, implementation challenges and market adaptation remain key risks to monitor.
Impact: positive
