Commodity Futures Trading Commission
(CFTC)Regulatory Snapshot
The Commodity Futures Trading Commission is an independent agency of the United States Government that regulates the US derivatives markets, including futures, swaps, and certain kinds of options. Established in 1975, the CFTC enforces one of the world's strictest regulatory frameworks for forex trading, with capital requirements that far exceed most international standards.
About the CFTC
The Commodity Futures Trading Commission (CFTC) is a United States federal regulatory agency responsible for overseeing the derivatives markets, encompassing futures, options, and swaps. Created by the US Congress in 1975, the CFTC operates as an independent agency with a mandate to promote open, transparent, competitive, and financially sound markets while protecting market participants from fraud, manipulation, and abusive practices.
Regulatory Framework
The US regulatory framework for forex trading is among the strictest in the world. Retail Foreign Exchange Dealers (RFEDs) must maintain a minimum adjusted net capital of $20 million — a requirement that effectively limits the US forex market to large, well-capitalised firms. All firms must register with the CFTC and become members of the National Futures Association (NFA), the self-regulatory body that works alongside the CFTC.
Investor Protection
US residents and citizens are only permitted to trade with CFTC-registered and NFA-member brokerages. Firms must maintain customer funds in segregated accounts, submit regular financial reports, and undergo periodic compliance examinations. The CFTC also operates a robust whistleblower programme that provides monetary awards to individuals who report violations of the Commodity Exchange Act.
- Strict minimum capital requirements of $20 million for Retail Foreign Exchange Dealers
- Mandatory customer fund segregation
- Regular audits, financial reporting, and compliance examinations
- Whistleblower programme with monetary awards
| Instrument | Retail | Professional |
|---|---|---|
| Major Forex | 1:50 | 1:50 |
| Minor Forex | 1:20 | 1:20 |
| Gold | 1:20 | 1:20 |
| Indices | 1:20 | 1:20 |
CFTC regulates commodity futures and options markets. Works alongside NFA and SEC.
Body: CFTC Office of Customer Education and Outreach
Visit Dispute ResolutionRelated Regulators
NFA
AATier 1National Futures Association
The National Futures Association is the industry-wide, self-regulatory organisation for the US derivatives industry. Working in partnership with the CFTC, the NFA develops rules, programmes, and services to safeguard market integrity, protect investors, and help its members fulfil their regulatory obligations. NFA membership is mandatory for all entities conducting futures and forex business in the United States.
CIMA
ATier 2Cayman Islands Monetary Authority
The Cayman Islands Monetary Authority is the regulatory body responsible for the supervision of financial services businesses in the Cayman Islands. Established in 1997, CIMA regulates banks, insurance companies, mutual funds, money service businesses, and securities investment firms within one of the world's most prominent international financial centres.
BMA
ATier 2Bermuda Monetary Authority
The Bermuda Monetary Authority is the integrated regulatory authority for the financial services sector in Bermuda. Established in 1969, the BMA supervises, regulates, and inspects financial institutions operating in or from Bermuda, including banks, investment businesses, insurance companies, and trust companies.
FinCEN
BTier 3Financial Crimes Enforcement Network
The Financial Crimes Enforcement Network is a bureau of the US Department of the Treasury. FinCEN's mission is to safeguard the financial system from illicit use, combat money laundering, and promote national security. While FinCEN does not regulate forex dealers in terms of market conduct or consumer protection, forex dealers must register with FinCEN as Money Services Businesses.
BCB
ATier 3Central Bank of Brazil
The Central Bank of Brazil (Banco Central do Brasil) is Brazil's monetary authority, responsible for monetary policy, currency issuance, financial system supervision, and foreign exchange market regulation. Established in 1964, the BCB plays a central role in regulating one of Latin America's largest and most dynamic financial markets.
BVI FSC
COffshoreBritish Virgin Islands Financial Services Commission
The British Virgin Islands Financial Services Commission is the regulatory authority responsible for the regulation, supervision, and inspection of financial services in the British Virgin Islands. Established in 2001, the BVI FSC oversees banking, insurance, fiduciary services, and investment business within the territory.