Pham wants to expand access to more sophisticated crypto trading instruments under strict delivery and leverage rules. Meanwhile, the Bank of England released a consultation paper proposing a comprehensive framework for regulating sterling-denominated “systemic stablecoins.” The plan would require issuers to back their tokens with central bank deposits and UK government debt while also imposing holding limits on individuals and businesses to safeguard financial stability. Overall, both the United States and the United Kingdom are advancing major regulatory initiatives in the crypto sector, as there is a growing need for global oversight of digital assets.
CFTC Moves Toward Leveraged Crypto Trading
Acting Chair of the US Commodity Futures Trading Commission (CFTC), Caroline Pham, is reportedly in discussions with several regulated American crypto exchanges to launch leveraged spot crypto products as early as next month. In a post that was shared on X, Pham confirmed her push to expand US crypto market offerings by allowing traders to take leveraged positions in spot markets. This could greatly broaden access to higher-risk, higher-reward crypto trading opportunities for retail and institutional investors.
According to Pham, talks are progressing despite the ongoing government shutdown, as the CFTC is still engaging with industry representatives to craft potential guidance for leveraged spot crypto products. The initiative builds on the agency’s earlier efforts in August, when it launched a proposal to enable trading of “spot crypto asset contracts” on exchanges under its oversight.
At the time, the CFTC wanted public input on rules surrounding the retail trading of commodities involving leverage, margin, or financing, which suggests that there is regulatory recognition of the crypto industry’s demand for more advanced trading products.
Announcement from the CFTC
Under existing law, the Commodity Exchange Act grants the CFTC authority over leveraged or margined retail commodity transactions, including cryptocurrencies, unless the buyer takes actual delivery of the asset within 28 days. This means that any leveraged crypto spot product offered in the US must ensure either physical delivery within that time frame or risk falling foul of regulatory restrictions.
The push for leveraged spot products comes as Washington grapples with a government shutdown that began on Oct. 1. While many federal agencies paused non-essential activities, Pham’s continued meetings indicate that progress on crypto regulation has not completely stalled.
Meanwhile, the US Senate is reportedly close to approving a continuing resolution to end the shutdown, which could potentially clear the way for more active regulatory work. Despite disruptions, several senators still pressed ahead with crypto-related legislative efforts, including a proposed bill to establish clearer market structure rules.
Bank of England Moves to Regulate Stablecoins
The UK is also making progress with its regulatory plans. The Bank of England (BoE) took a big step toward regulating stablecoins by publishing a consultation paper outlining a proposed framework for sterling-denominated “systemic stablecoins.” The goal of the proposal is to manage potential financial stability risks posed by stablecoins that are widely used for payments in the United Kingdom. This means that the UK plans to align its regulatory stance with that of other major economies like the United States.
Under the new proposal, the BoE would require stablecoin issuers to hold at least 40% of their liabilities in unremunerated deposits at the central bank, while the remaining 60% could be backed by short-term UK government debt. This balance is designed to ensure that stablecoins remain sufficiently liquid and secure, while also supporting the resilience of the broader financial system.
Consultation paper published by the Bank of England
The consultation is open until Feb. 10, 2026, seeks industry and public feedback before final regulations are introduced in the second half of the year. It also includes proposed limits on individual and business holdings of stablecoins.
(Source: Bank of England)
According to the document, individuals will be restricted to a maximum of £20,000 ($26,300) per stablecoin, while businesses would face a cap of £10 million ($13.2 million), with possible exemptions for firms that require higher balances to operate effectively.
For stablecoin issuers deemed “systemically important,” the BoE suggested that as they grow in scale, they could initially back up to 95% of their assets with UK government debt securities, though this ratio would gradually be reduced to 60% once the issuer reaches a size considered systemically significant. The aim is to strike a balance between stability and operational flexibility as stablecoins evolve in the financial ecosystem.
The BoE explained that His Majesty’s Treasury will determine which stablecoin payment systems and service providers qualify as systemically important. Once designated, these entities will fall under the proposed regulatory regime and the central bank’s direct supervision.
