KEY FACTS: The U.S. Commodity Futures Trading Commission (CFTC) has introduced a regulatory framework allowing Americans to trade on offshore cryptocurrency exchanges through the Foreign Board of Trade (FBOT) registration process, as part of its "crypto sprint" initiative. This move, detailed in an advisory from the CFTC’s Division of Market Oversight, aims to restore regulatory clarity, boost market liquidity, and bring crypto firms back to the U.S. by enabling offshore platforms like Binance and Bybit to serve U.S. clients under strict oversight, including market surveillance and anti-manipulation controls. The decision addresses years of regulatory uncertainty that drove trading volume offshore.

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Sources: CFTC

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U.S. Regulator Opens Pathway for Americans to Trade on Offshore Crypto Exchanges

The U.S. Commodity Futures Trading Commission (CFTC) announced on Thursday, August 28, 2025, a new regulatory framework that paves the way for American traders to legally access offshore cryptocurrency exchanges. This development, part of the CFTC’s ongoing “crypto sprint” initiative, marks a significant shift in U.S. policy toward digital assets, aiming to restore regulatory clarity, boost market liquidity, and bring crypto companies back to American shores. The announcement, detailed in an advisory from the CFTC’s Division of Market Oversight, leverages the existing Foreign Board of Trade (FBOT) framework to allow non-U.S. exchanges to serve U.S.-based clients under strict regulatory oversight.

The CFTC’s advisory clarifies that offshore crypto exchanges can now register as Foreign Boards of Trade (FBOTs), a designation that has allowed U.S. clients to trade on registered offshore platforms across various asset classes since the 1990s. Acting CFTC Director Caroline Pham emphasized the significance of this move, stating thus:

“Starting now, the CFTC welcomes back Americans who want to trade efficiently and safely under CFTC regulations, and opens up U.S. markets to the rest of the world. It’s just another example of how the CFTC will continue to deliver wins for President Trump as part of our crypto sprint.”
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This decision comes at a time when the U.S. cryptocurrency market has faced significant challenges due to regulatory ambiguity. Between 2021 and 2024, a lack of clear regulations drove many crypto companies to relocate offshore, resulting in the majority of crypto trading volume occurring on non-U.S. platforms. The CFTC’s new guidance aims to reverse this trend by providing a clear compliance pathway for offshore exchanges, potentially enabling major platforms like Binance, Bybit, and OKX to serve U.S. clients legally.

The FBOT framework is not new but is being repurposed to address the unique needs of the crypto industry. Since the 1990s, Americans have been able to trade on foreign exchanges registered as FBOTs, provided these platforms meet stringent CFTC standards, including market surveillance, recordkeeping, reporting, and anti-manipulation controls. The framework requires offshore exchanges to be fully licensed in their home jurisdictions, with regulatory regimes deemed comparable to U.S. oversight standards.

Cheryl Isaac, a partner at K&L Gates LLP specializing in derivatives and commodities law, described the CFTC’s guidance as a “reminder of existing rules” that have been in place for over a decade. She noted that exchanges must demonstrate financial integrity, enforce rules against abusive trading practices, and be authorized to operate in their home jurisdictions. Several firms from jurisdictions like Japan, Australia, Europe, the UK, and Singapore are already registered under this framework, suggesting a streamlined path for crypto exchanges that meet these criteria.

The CFTC’s move is part of an effort to address the regulatory uncertainty that has plagued the U.S. crypto industry. Edwin Mata, an attorney and CEO of tokenization platform Brickken, said that ambiguous regulations have fragmented the U.S. policy landscape, creating a “legal burden” for crypto companies. This lack of clarity led to an exodus of crypto firms from the U.S. between 2021 and 2024, as companies sought more favorable regulatory environments abroad. The result was a significant portion of crypto trading volume shifting to offshore exchanges, leaving U.S. traders with limited access to global liquidity.

Mata emphasized that clear regulations would reduce the legal risks for crypto companies, allowing them to operate in the U.S. without fear of enforcement actions. The CFTC’s FBOT advisory addresses this issue by providing a structured pathway for offshore exchanges to register and operate legally in the U.S., thereby “onshoring” trading activity that was previously driven abroad.

The CFTC’s announcement is a key component of its “crypto sprint,” an initiative launched to implement comprehensive crypto regulations in response to recommendations from President Donald Trump’s Working Group on Digital Asset Markets. President Trump has repeatedly expressed his desire to bring crypto companies back to the U.S. to establish leadership in digital assets. The Working Group’s report, released earlier in August 2025, outlined 18 recommendations, including clearer guidelines on cryptocurrencies as commodities, registration requirements for decentralized finance (DeFi) participants, and rules for blockchain-based derivatives.

The CFTC is also coordinating with the SEC’s “Project Crypto,” a commission-wide initiative to modernize securities rules for blockchain-based financial markets. This collaboration signals a more structured approach to digital asset oversight under the Trump administration, with both agencies working to provide clear guardrails for the industry. The CFTC’s efforts are further supported by its recent partnership with Nasdaq to strengthen crypto market oversight, demonstrating a commitment to fostering innovation while ensuring robust supervision.

For offshore exchanges, the FBOT pathway offers a legal route to tap into the lucrative U.S. market, which is the largest cryptocurrency market globally, with approximately $1.3 trillion in on-chain value received between July 2023 and June 2024. Platforms like Binance, which currently operates in the U.S. through a separate entity (Binance.US) with limited availability, could see significant opportunities to expand their reach. However, exchanges must comply with rigorous CFTC requirements, including robust compliance programs and cooperation with U.S. regulators, to qualify for FBOT registration.

Meanwhile, the CFTC is actively seeking public feedback to refine its crypto policies to craft regulations that protect financial market participants without imposing undue burdens that could drive innovative projects offshore. The public comment period for the CFTC’s spot crypto trading initiative, launched earlier in August, closes on September 18, 2025. This initiative, which explores the trading of spot crypto contracts on CFTC-registered designated contract markets (DCMs), complements the FBOT advisory by providing additional avenues for crypto trading under federal oversight.

The CFTC’s current leadership transition adds a layer of complexity to these efforts. Acting Chairman Caroline Pham is the only remaining commissioner following the resignation of Kristin Johnson and the departure of former Chair Rostin Behnam and commissioners Summer Mersinger and Christy Goldsmith Romero. President Trump’s nominee for permanent CFTC chair, Brian Quintenz, awaits Senate confirmation, which could influence the agency’s future direction.

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Information Sources:

• CFTC
• Cointelegraph
• Bitcoinethereum News
• [](

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