The CFTC warned this week that while 24/7 markets may fit crypto-native ecosystems, they aren’t automatically safe for every traditional derivatives product — and regulators want firms to prove otherwise. In a Friday advisory, the Commodity Futures Trading Commission told regulated exchanges and clearinghouses to carefully evaluate any decision to move trading and clearing to a nonstop model. The agency said some markets can support constant access thanks to modern infrastructures — blockchain networks, decentralized protocols, crypto collateral and stablecoins, and mobile-first trading — but that doesn’t mean round-the-clock hours are appropriate for every asset class. At the same time, the CFTC formally cleared the way for CFTC-regulated crypto platforms to offer perpetual futures and global options. Coinbase said the approval allows a CFTC-regulated affiliate to add the “largest and most liquid” category of global crypto trading to its existing 24-hour platform. Coinbase also noted it already supports 24/7 trading across equities, futures and prediction markets, and the new sign-off expands that offering to crypto perpetuals and global options. But the advisory stresses markets aren’t interchangeable. The agency flagged agricultural derivatives as an example where 24/7 trading could be problematic because those markets rely on a different customer base, regional structure and specialized hedging practices. The CFTC warned that off-peak hours can bring thinner liquidity, larger price swings, wider bid-ask spreads, and higher vulnerability to manipulation. Under existing rules, trading platforms remain the first line of defense against market abuse. The CFTC urged firms that expand trading hours to implement compliance controls tailored to the unique risks of constant trading. It also asked regulated exchanges and clearing organizations to consult with the agency before making major changes to trading schedules, framing those consultations as part of its oversight role as market structures evolve. The advisory arrives amid a broader policy push under CFTC Chairman Mike Selig, who has made crypto, prediction markets and new trading technology central priorities. The agency’s current leadership has both opened more space for regulated digital-asset products and revisited older enforcement decisions: a joint motion filed Wednesday in Manhattan federal court asks a judge to vacate a January 2025 consent order that had resolved a $5 million settlement with Gemini tied to a proposed Bitcoin futures contract. Bottom line: the CFTC is signaling it’s willing to accommodate 24/7 crypto derivatives — but traditional derivatives platforms must demonstrate that nonstop trading won’t weaken market oversight or increase systemic risk before making the leap. Read more AI-generated news on: undefined/news