The CFTC says that some derivatives markets may not be compatible with 24/7 trading
The CFTC has warned regulated derivatives platforms that overnight trading may be compatible with crypto-native markets but may not be safe for all traditional asset classes.
Summary
- The CFTC has warned that 24/7 trading may not be compatible with all traditional derivatives markets.
- Coinbase said the CFTC approval adds crypto perpetuals and global options to its regulated portfolio.
- The CFTC and Gemini asked a Manhattan court to vacate the $5 million order.
The CFTC said in an advisory on Friday that exchanges and clearinghouses should carefully evaluate products before extending trading and clarifying the 24/7 model. The agency said some markets can support constant access because new trading systems use blockchain networks, decentralized infrastructure, crypto collateral, stablecoins, and mobile platforms.
The warning came as the agency also allowed crypto platforms regulated by the CFTC to offer perpetual futures and global options. Coinbase said in a blog post on Friday that the approval allows one of its regulated affiliates to add the largest and most liquid crypto trading class in the world to its existing 24-hour facility.
The CFTC draws a line between crypto and traditional markets
According to the advisory, the agency does not view all markets in the same way regarding permanent trading hours. The CFTC said that agricultural derivatives may face different restrictions due to their customer base, regional structure, and special hedging practices.
The agency said some products may experience less liquidity during off-peak periods. Under those conditions, the CFTC said markets may experience greater price volatility, wider bid-ask spreads, and greater exposure to fraud.
Under CFTC rules, trading platforms remain the first line of defense against market abuse. The agency said firms that extend trading hours should add compliance controls that match the risks posed by frequent access.
Agency Asks Firms to Discuss 24/7 Programs
In its letter, the CFTC urged regulated exchanges and clearinghouses to consult with the agency before making major changes to trading systems. The advisory is building those discussions as part of the agency’s oversight role, especially as market structures around crypto products change.
CFTC Chairman Mike Selig has made crypto, prediction markets, and trading technology key issues for the agency. Under his leadership, the regulator has made several crypto policy decisions as the Trump administration pressures government agencies to provide the digital asset industry with clarity.
Coinbase said its platform already supports 24/7 trading in all equities, futures and futures markets. The company said the new approval adds crypto perpetuals and global options to that list through the CFTC-regulated agency.
The Gemini settlement change adds to the policy reset
A similar policy situation affected older law enforcement cases. As crypto.news has previously covered, the CFTC moved to throw out its $5 million settlement with Gemini after deciding that the case should not have been brought under the agency’s current standards.
According to a joint petition filed Wednesday in Manhattan federal court, the CFTC and Gemini asked a judge to revoke the January 2025 consent order. The order had resolved allegations linked to the proposed Bitcoin futures contract.
The request shows how the agency’s current leadership is reviewing past crypto actions while opening more space for regulated digital asset products. The CFTC is ready to allow 24-hour crypto markets, but wants derivatives platforms to prove that regular trading won’t weaken market oversight.
