CFTC Gives Green Light to Spot Crypto Trading as Bitnomial Exchange Readies for Launch

A crypto exchange overseen by the U.S. Commodity Futures Trading Commission will begin offering spot crypto trading next week, according to Acting CFTC Chair Caroline Pham.

“For the first time ever, spot crypto can trade on CFTC-registered exchanges that have been the gold standard for nearly a hundred years, with the customer protections and market integrity that Americans deserve,” she said in a statement.

The exchange, dubbed Bitnomial, plans to let traders access cryptocurrency trading in its most common form alongside perpetual futures and options, according to a press release. The company said its debut is expected to take place in the U.S. on Monday.

The exchange billed its debut as a “watershed moment for U.S. crypto markets,” arguing that Bitnomial is establishing a standard for cryptocurrency markets in America. It noted that traders will be able to access leveraged spot crypto trading through its services.

When trading spot cryptocurrencies on leverage, investors use borrowed funds to amplify the size of their positions. That’s distinct compared to derivatives like perpetual futures, where traders never actually engage with the underlying digital asset itself. 

“We’re bringing leveraged spot crypto trading back to the U.S. with CFTC oversight,” Bitnomial founder and CEO Luke Hoersten said in a statement.

Leveraged spot crypto trading is commonplace outside the U.S., but under previous leadership, Pham argued that the CFTC was focused on targeting the industry, as opposed to giving crypto users a relatively safer place to trade.

Bitnomial highlighted portfolio margin across several asset classes, saying it can eliminate “redundant margin requirements,” or the need for traders to use multiple platforms. The company’s supervision under the CFTC also alleviates concerns that institutions or brokers may have when using platforms subject to state money transmitter oversight, it added.

In November, CoinDesk reported that Pham had been meeting personally with regulated exchanges to begin the process of rolling out crypto products on their platforms.

Bitnomial’s debut comes as U.S. lawmakers debate details of a market structure bill that would establish jurisdictional boundaries between the CFTC and Securities and Exchange Commission over the crypto industry.

Bitnomial said it’s able to offer leveraged spot crypto trading through its so-called designated contract market and derivatives clearing organization. Pham began seeking feedback on the plan in August, yet some experts warned of potential legal and regulatory risks.