Law and Ledger is a news segment focusing on crypto legal news, brought to you by Kelman Law – A law firm focused on digital asset commerce.

This week brought meaningful developments on both sides of the Atlantic. The Commodity Futures Trading Commission began developing a federal framework for certain leveraged retail crypto transactions while proposing new boundaries between regulated event contracts and conventional gambling. In Europe, regulators addressed noncompliant stablecoins and advanced plans for direct supervision of significant crypto-asset service providers. A New York settlement with Celsius co-founder Alex Mashinsky also demonstrated the continuing importance of state enforcement.

On October 5, the CFTC issued an advance notice of proposed rulemaking concerning retail crypto-asset transactions. The notice begins—but does not complete—a rulemaking process under Section 2(c)(2)(D) of the Commodity Exchange Act.

That provision governs certain commodity transactions offered to retail customers on a leveraged, margined, or financed basis. The agency is considering how it should apply the existing statutory framework to such crypto transactions, which the notice calls “CTXs.” Among other matters, the CFTC is requesting feedback on safeguards against abusive practices, requirements tailored to crypto markets and the possible creation of a “crypto asset market” subcategory within designated contract market registration.

The notice is significant, but it is not yet a proposed or final rule. Comments will be due 60 days after publication in the Federal Register, after which the CFTC may decide whether and how to issue a formal proposal.

For exchanges and other trading platforms, such rules could offer a more defined federal route for certain retail leveraged products.

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