CFTC Issues Guidelines for 24/7 Trading and Clearing Compliance

The U.S. Commodity Futures Trading Commission (CFTC) has released staff guidelines from its market regulation, clearing, and risk departments, addressing the growing trend of 24/7 trading, clearing, and settlement models. According to Odaily, the guidelines outline regulatory expectations and compliance requirements, encouraging market innovation while ensuring adherence to regulations. The guidelines emphasize that regulated trading platforms, swap execution facilities, derivatives clearing organizations, and futures commission merchants must comply with the Commodity Exchange Act (CEA) and related regulatory rules when expanding around-the-clock trading. They are also urged to proactively assess risk management and operational arrangements. The CFTC notes that different asset classes vary in their suitability for 24/7 trading. Derivatives related to crypto assets, due to their digital infrastructure and global continuous trading characteristics, are more suitable for round-the-clock trading and clearing. In contrast, traditional commodity derivatives like agricultural products may not be fully compatible with 24/7 operations due to regional and structural trading characteristics. CFTC staff indicate that relevant institutions should ensure compliance with regulatory frameworks and risk control requirements while promoting ongoing market evolution to support "responsible market innovation."