CFTC Chairman Michael Selig: Financial Transformation in the Next Decade Will Exceed the Total of the Past Several Decades

Michael Selig, Chairman of the U.S. Commodity Futures Trading Commission (CFTC), stated at the U.S. Treasury Market Annual Conference hosted by the New York Fed that regulators and markets must prepare for "massive tokenization": with the development of tokenization, on-chain finance, and 24/7 trading, changes in financial markets over the next decade are likely to exceed the total of the previous several decades.

Selig noted that the entire Trump administration has laid the groundwork for this transformation, with a path that embraces innovation, encourages competition, and seeks to "right-size" regulation. He pointed out directions including promoting asset tokenization, allowing around-the-clock trading, and integrating stablecoins into the core of the derivatives market. The CFTC will seek to "encourage exchanges, clearinghouses, and market participants to responsibly adopt stablecoins." He believes that once blockchain and AI are scaled, their impact on reshaping financial market structures will surpass any comparable period, necessitating adjustments to existing market rules.

The CFTC has already taken several substantial actions. In December 2025, the CFTC launched a digital asset collateral pilot program, allowing assets such as Bitcoin, Ethereum, and USDC to be used as margin in the derivatives market, and issued Employee Letters No. 25-39 and No. 25-40. In February 2026, the CFTC included stablecoins issued by national trust banks in the list of qualified collateral. Over the past year, the CFTC has also issued guidance on 24/7 trading in the energy derivatives market and publicly sought opinions, and on July 9 of this year, it postponed the launch of a 10-barrel WTI crude oil futures contract by CME. On September 17, the CFTC submitted a draft rule numbered RIN 3038-AF80 on "Cryptocurrency Asset Trading and Cryptocurrency Asset Market Regulation" to the White House Office of Information and Regulatory Affairs (OIRA), planning to establish a new designated contract market (DCM) registration category for cryptocurrency exchanges, while also issuing Employee Letter No. 26-25, expanding the non-prosecution exemption for passive cryptocurrency software developers.

The failure on the legislative front has pushed regulators to the forefront. On September 15, the Senate conducted a procedural vote on the CLARITY Act, a digital asset market structure bill, which received only 49 votes, failing to meet the 60-vote threshold, and the bill was shelved. Two days later, the SEC issued an "innovation exemption," allowing U.S. stocks listed on federal securities exchanges (NMS stocks) to be traded in token form on licensed on-chain trading venues, with a 5-year exemption period. Additional conditions include: a 30-day prior notice before tokenization, the issuing company has the right to object; tokens must represent real ownership and grant holders the same dividends and voting rights as traditional stocks; synthetic tokens, derivatives, and debt instruments are excluded. SEC Chairman Paul Atkins stated that this exemption allows companies to "operate in a licensed environment today while the commission assesses whether further action is needed."

Selig himself is a key executor of the shift in cryptocurrency regulation. From 2014 to 2015, he served as a legal assistant to then-Commissioner J. Christopher Giancarlo at the CFTC; from 2022 to 2025, he was a partner at the law firm Willkie Farr & Gallagher, with clients including eToro and Paradigm; in 2025, he became the Chief Legal Advisor for the SEC's cryptocurrency working group and concurrently served as a senior advisor to Atkins. He was nominated by Trump in October 2025, confirmed by the Senate on December 18, and sworn in as the 16th Chairman of the CFTC on December 22. Following the departure of the last commissioner, Caroline Pham, Selig became the only commissioner on this typically five-member committee. Since taking office, the CFTC has submitted several amicus briefs supporting prediction market platforms, including asserting exclusive regulatory authority over prediction markets in a lawsuit involving Crypto.com and the state of Nevada this February.

In terms of market mechanisms, this is expectation-driven trading driven by policy signals, not a single event. Potential buyers are platforms laying out tokenized assets and 24/7 trading: CME, which has announced 24/7 trading for cryptocurrency futures and options; Coinbase, which acquired Deribit for $2.9 billion in 2025; Robinhood, which launched tokenized U.S. stocks in Europe; and exchanges like Kraken that issue xStocks. Stablecoin issuers Circle and stablecoin issuing institutions holding national trust bank licenses will directly benefit from the opening of collateral eligibility. Funds are shifting from the traditional "T+1 settlement, weekday trading" system to on-chain infrastructure that allows for 24-hour settlement with stablecoins as collateral. Traditional clearing, custody, and brokerage institutions that rely on trading hours, settlement cycles, and custody tiers to earn intermediary fees are under pressure; additionally, platforms relying on temporary exemptions for operation also bear the risk of policy reversals in light of the CLARITY Act being shelved.

Supplementary data: The SEC's innovation exemption period is 5 years. The CFTC's new rule draft requires two rounds of public comment and two rounds of OIRA review, and binding formal rules are not expected until the end of 2027 at the earliest.

Source: Public Information