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Federal Trade Commission: Letter Regarding Hospital Price Transparency
WASHINGTON, Oct. 6 -- The Federal Trade Commission issued the following warning letter:
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October 5, 2026
Re: Letter Regarding Hospital Price Transparency
Dear [Name],
The Federal Trade Commission ("FTC") understands that [Company] operates healthcare facilities in the United States. As the Chairman of the FTC, I write to inform you of your pricetransparency obligations under the Federal Trade Commission Act ("FTC Act"). Specifically, Section 5 of the FTC Act requires you to provide patients with timely, accurate, and complete pricing for healthcare services, especially for non-emergency ... Show Full Article WASHINGTON, Oct. 6 -- The Federal Trade Commission issued the following warning letter: * * * October 5, 2026 Re: Letter Regarding Hospital Price Transparency Dear [Name], The Federal Trade Commission ("FTC") understands that [Company] operates healthcare facilities in the United States. As the Chairman of the FTC, I write to inform you of your pricetransparency obligations under the Federal Trade Commission Act ("FTC Act"). Specifically, Section 5 of the FTC Act requires you to provide patients with timely, accurate, and complete pricing for healthcare services, especially for non-emergencyservices that are scheduled in advance. I encourage you to conduct a comprehensive review of your pricing practices and, to the extent you determine that they do not comply with Section 5 as explained in this letter, take corrective action swiftly. The FTC is sending similar warning letters to other healthcare-service providers.
The FTC is the federal agency responsible for protecting American consumers from deceptive, unfair, and anticompetitive business practices. As part of that mission, the FTC brings law enforcement actions and educates businesses, industries, and market participants about compliance with the laws and rules it enforces. Section 5 of the FTC Act prohibits unfair or deceptive acts or practices./1 A representation or omission is deceptive under the FTC Act if it is material and would likely mislead consumers acting reasonably under the circumstances./2 An act or practice is unfair if it causes or is likely to cause substantial injury to consumers that cannot reasonably be avoided, and that injury is not outweighed by countervailing benefits to consumers or competition./3 In exercising its enforcement authority under Section 5, the FTC is particularly focused on protecting vulnerable populations, including rural Americans, seniors, and veterans, many of whom lack access to affordable and transparent healthcare. Accordingly, the FTC established a Healthcare Task Force earlier this year to engage in a coordinated, integrated approach to healthcare enforcement and advocacy to protect patients, healthcare workers, and taxpayers./4
One of the Trump FTC's enforcement priorities is ensuring that pricing is transparent and truthful. The FTC has prioritized promoting price transparency across multiple markets, including rental housing,5 ticketing and hotels,/6 grocery delivery services,/7 and auto sales and leasing.8 When consumers do not know the true price of a product or service, consumers and competition suffer: Consumers cannot compare merchants' offerings and make informed decisions, businesses trying to deal honestly and transparently with consumers are put at a competitive disadvantage, and the market cannot operate efficiently.
Price transparency is particularly critical in the hospital and healthcare setting because healthcare is often one of the most significant and financially burdensome costs consumers face. Patients frequently must invest substantial time and effort to travel for in person visits, making it even more important that they understand costs upfront before committing to care. Moreover, hospitals and healthcare facilities can charge dramatically different prices for the same services, leaving consumers vulnerable to wide and often unexpected cost discrepancies.
This is why the Trump-Vance Administration has focused on improving affordability and price transparency for healthcare services. Executive Order 13877 (2019), issued during President Trump's first term, directed the Department of Health & Human Services to require that hospitals publicly disclose pricing information for shoppable services through a consumerfriendly display and in machine-readable format ("MRF") to support consumer decisionmaking.9 Following Executive Order 13877, the Centers for Medicare & Medicaid Services ("CMS") issued the Hospital Price Transparency rule, effective January 1, 2021, requiring hospitals to publish pricing information, including for certain shoppable services./10 The TrumpVance Administration has taken further strides to promote price transparency through Executive Order 14221 (2025), which directs relevant cabinet secretaries to take all necessary actions to require disclosure of actual prices, not merely estimates, and standardization of how pricing information is presented across hospitals and health plans./11 CMS then expanded price transparency requirements effective January 1, 2026./12 CMS also has implemented the No Surprises Act and related regulations to protect consumers, providing safeguards against surprise medical billing, including requirements for issuing good-faith estimates./13
CMS price-transparency rules, which are administered and enforced by CMS, establish a critical foundation for ensuring that healthcare facilities provide information to consumers related to pricing./14 These rules are, however, a regulatory floor: compliance with CMS requirements does not mean that a hospital has met its obligations under Section 5 of the FTC Act, which prohibits unfair or deceptive acts or practices in the marketplace./15 In other words, the CMS rules do not provide a safe harbor from liability under the FTC Act.
Under Section 5, the price of healthcare services is a material term./16 This means that clear and conspicuous disclosures are often necessary to prevent consumers from being deceived./17 Accordingly, failing to disclose the price of a healthcare service may be deceptive if it is likely to mislead consumers acting reasonably under the circumstances./18 Even when some price terms are disclosed, disclosures may be deceptive when they are incomplete--such as when they omit certain charges like physician fees or facility fees, or cover only a portion of the expected care--because consumers may reasonably believe they have been provided the total cost of care. Likewise, inaccurate disclosures mislead consumers and cause substantial harm.
Failure to provide transparent pricing may also be "unfair" under Section 5 if it causes or is likely to cause substantial injury to consumers that is not reasonably avoidable by consumers themselves and not outweighed by countervailing benefits to consumers or competition./19 For example, when price information is incomplete, inaccurate, or not provided sufficiently in advance for scheduled services, consumers cannot compare competing healthcare providers' services or make informed decisions. Nor do incomplete, inaccurate, or untimely pricing disclosures (where that information is reasonably available to the healthcare provider in advance) provide any countervailing benefits to competition or consumers. On the contrary, it undermines competition by obscuring one of the most important dynamics of competition from consumers' observation and comparison.
Accordingly, the FTC encourages you and all healthcare-service providers in the United States to conduct a comprehensive review of your price-transparency practices to ensure you are providing consumers with timely, accurate, and complete pricing for healthcare services, especially those scheduled in advance, and, if you are not, to take corrective action swiftly. The FTC will continue to monitor the healthcare marketplace and take enforcement action as warranted.
This letter is not intended to reflect a particularized assessment of your pricetransparency practices, nor is it intended to reflect a conclusion as to whether you have engaged in conduct violative of the FTC Act. If you have any questions about this letter, please contact the Bureau of Consumer Protection's Division of Advertising Practices at HealthcarePriceTransparency@ftc.gov. Sincerely, Andrew N. Ferguson Chairman Federal Trade Commission
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1/ 15 U.S.C. Sec. 45(a).
2/ See Fed. Trade Comm'n, Policy Statement on Deception, appended to In re Cliffdale Assocs., Inc., 103 F.T.C. 110 (1984). Among other requirements, the FTC Act requires that representations be truthful and non-misleading. See FTC v. Direct Mktg. Concepts, Inc., 624 F.3d 1, 8 (1st Cir. 2010).
3/ 15 U.S.C. Sec. 45(n); see Fed. Trade Comm'n, Policy Statement on Unfairness, appended to Int'l Harvester Co., 104 F.T.C. 949 (1984).
4/ See Fed. Trade Comm'n, FTC Chairman Andrew N. Ferguson Launches Healthcare Task Force (Mar. 20, 2026), https://www.ftc.gov/news-events/news/press-releases/2026/03/ftc-chairman-andrew-n-ferguson-launcheshealthcare-task-force.
5/ E.g., Complaint, FTC v. Greystar Real Estate Partners, No. 1:25-cv-00165 (D. Colo. Jan. 16, 2025).
6/ E.g., Complaint, FTC v. Live Nation Ent., No. 2:25-cv-8884 (C.D. Cal. Sept. 18, 2025); see also Trade Regulation Rule on Unfair or Deceptive Fees, 16 C.F.R. pt. 464 (effective May 5, 2025).
7/ E.g., Complaint, FTC v. Instacart, No. 3:25-cv-10783 (N.D. Cal. Dec. 18, 2025).
8/ E.g., Complaint, FTC v. Lindsay Chevrolet, No. 1:24-cv-02362 (E.D. Va. Dec. 27, 2024).
9/ Exec. Order No. 13,877, 84 Fed. Reg. 30,849-50 (June 27, 2019).
10/ See 45 C.F.R. pt. 180; see also 84 Fed. Reg. 65,524 (Nov. 27, 2019). The 2021 rule requires hospitals to publicly disclose standard charges by (1) posting a file in MRF containing all standard charges for all hospital items and services; and (2) providing a consumer-friendly display of standard charges for at least 300 shoppable services. See Ctrs. for Medicare & Medicaid Servs., CY 2020 Hospital Outpatient Prospective Payment System (OPPS) Policy Changes: Hospital Price Transparency Requirements (CMS 1717 F2) (Nov. 15, 2019), https://www.cms.gov/newsroom/fact-sheets/cy-2020-hospital-outpatient-prospective-payment-system-opps-policychanges-hospital-price.
11/ Exec. Order No. 14221, 90 Fed. Reg. 11,005-06 (Feb. 28, 2025).
12/ See 45 C.F.R. Sec. 180.50. CMS expanded price-transparency requirements consistent with Exec. Order 14,221, by replacing "estimated allowed amount" with standardized data elements: median, 10th percentile, and 90th percentile values of the allowed amounts in dollars, as well as the total count of allowed amounts. CMS also implemented stricter MRF rules by requiring hospitals to attest to the completeness and accuracy of the posted standard charge information and to identify an official responsible for ensuring data accuracy. See Ctrs. for Medicare & Medicaid Servs., CY 2026 OPPS and Ambulatory Surgical Center Final Rule - Hospital Price Transparency Policy Changes (CMS-1834-FC) (Nov. 21, 2025), https://www.cms.gov/newsroom/fact-sheets/cy-2026-opps-ambulatory-surgicalcenter-final-rule-hospital-price-transparency-policy-changes.
13/ See 42 U.S.C. Sec. 300gg-136 (2024); see also 45 C.F.R. pt. 149 (2025).
14/ According to recent reports, CMS has warned over 500 hospitals that they have failed to comply with CMS's expanded price-transparency requirements. See Josh Boak, Trump Administration Warns Over 500 Hospitals to Provide More Price Information or Face Fines, Associated Press (June 9, 2026), https://apnews.com/article/trumphospital-prices-healthcare-affordability-313817c2ba73f1a3f4055ecde27b82be; see also Ctrs. for Medicare & Medicaid Servs., Hospital Price Transparency Enforcement Updates, (Apr. 26, 2023), https://www.cms.gov/newsroom/fact-sheets/hospital-price-transparency-enforcement-updates.
15/ See 15 U.S.C. Sec. 45.
16/ See Policy Statement on Deception, supra n. 2, at 175 (information about cost of a service a material term).
17/ See id. at 176 ("Some cases involve omission of material information, the disclosure of which is necessary to prevent the claim, practice, or sale from being misleading."). To be effective, disclosures must be clear and conspicuous. See, e.g., Thompson Med. Co., 104 F.T.C. 648, 842-43 (1984), aff'd, 791 F.2d 189 (D.C. Cir. 1986); see generally Removatron Int'l Corp. v. F.T.C., 884 F.2d 1489, 1498-1501 (1st Cir. 1989); see also Cyberspace.com, 453 F.3d at 1200-01 (holding that fine print statement may be insufficient to correct a misleading representation); Kraft, Inc. v. FTC, 970 F.2d 311, 326 (7th Cir. 1992) (holding that to correct inaccurate impressions contributing to consumer deception, disclosures must be prominent and unambiguous); FTC v. Direct Mktg. Concepts, Inc., 624 F.3d at 12 (holding that disclaimers do not cure deception unless they are "sufficiently prominent and unambiguous" to change the impression of the advertisement).
18/ See Policy Statement on Deception, supra n. 2, at 175; see also FTC v. Gill, 265 F.3d 944, 950 (9th Cir. 2001) ("An act or practice is deceptive if 'first, there is a representation, omission, or practice that, second, is likely to mislead consumers acting reasonably under the circumstances, and third, the representation, omission, or practice is material.'"); see also FTC v. Pantron I Corp., 33 F.3d 1088, 1095 (9th Cir. 1994) (citing Cliffdale Assocs., 103 F.T.C. at 164-65). To be material, a claim must convey information that is important to consumers and thus be likely to affect their choice of a product. See FTC v. Cyberspace.com, LLC, 453 F.3d 1196, 1201 (9th Cir. 2006) (citing Cliffdale Assocs., 103 F.T.C. at 165).
19/ FTC Act Sec. 5(n), 15 U.S.C. Sec.45(n); see also Policy Statement on Unfairness, supra n. 3, at 1070-76.
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Original text here: https://www.ftc.gov/system/files/ftc_gov/pdf/Hospital-Letter-Template.pdf
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October 5, 2026
Re: Letter Regarding Hospital Price Transparency
Dear [Name],
The Federal Trade Commission ("FTC") understands that [Company] operates healthcare facilities in the United States. As the Chairman of the FTC, I write to inform you of your pricetransparency obligations under the Federal Trade Commission Act ("FTC Act"). Specifically, Section 5 of the FTC Act requires you to provide patients with timely, accurate, and complete pricing for healthcare services, especially for non-emergency ... Show Full Article WASHINGTON, Oct. 6 -- The Federal Trade Commission issued the following warning letter: * * * October 5, 2026 Re: Letter Regarding Hospital Price Transparency Dear [Name], The Federal Trade Commission ("FTC") understands that [Company] operates healthcare facilities in the United States. As the Chairman of the FTC, I write to inform you of your pricetransparency obligations under the Federal Trade Commission Act ("FTC Act"). Specifically, Section 5 of the FTC Act requires you to provide patients with timely, accurate, and complete pricing for healthcare services, especially for non-emergencyservices that are scheduled in advance. I encourage you to conduct a comprehensive review of your pricing practices and, to the extent you determine that they do not comply with Section 5 as explained in this letter, take corrective action swiftly. The FTC is sending similar warning letters to other healthcare-service providers.
The FTC is the federal agency responsible for protecting American consumers from deceptive, unfair, and anticompetitive business practices. As part of that mission, the FTC brings law enforcement actions and educates businesses, industries, and market participants about compliance with the laws and rules it enforces. Section 5 of the FTC Act prohibits unfair or deceptive acts or practices./1 A representation or omission is deceptive under the FTC Act if it is material and would likely mislead consumers acting reasonably under the circumstances./2 An act or practice is unfair if it causes or is likely to cause substantial injury to consumers that cannot reasonably be avoided, and that injury is not outweighed by countervailing benefits to consumers or competition./3 In exercising its enforcement authority under Section 5, the FTC is particularly focused on protecting vulnerable populations, including rural Americans, seniors, and veterans, many of whom lack access to affordable and transparent healthcare. Accordingly, the FTC established a Healthcare Task Force earlier this year to engage in a coordinated, integrated approach to healthcare enforcement and advocacy to protect patients, healthcare workers, and taxpayers./4
One of the Trump FTC's enforcement priorities is ensuring that pricing is transparent and truthful. The FTC has prioritized promoting price transparency across multiple markets, including rental housing,5 ticketing and hotels,/6 grocery delivery services,/7 and auto sales and leasing.8 When consumers do not know the true price of a product or service, consumers and competition suffer: Consumers cannot compare merchants' offerings and make informed decisions, businesses trying to deal honestly and transparently with consumers are put at a competitive disadvantage, and the market cannot operate efficiently.
Price transparency is particularly critical in the hospital and healthcare setting because healthcare is often one of the most significant and financially burdensome costs consumers face. Patients frequently must invest substantial time and effort to travel for in person visits, making it even more important that they understand costs upfront before committing to care. Moreover, hospitals and healthcare facilities can charge dramatically different prices for the same services, leaving consumers vulnerable to wide and often unexpected cost discrepancies.
This is why the Trump-Vance Administration has focused on improving affordability and price transparency for healthcare services. Executive Order 13877 (2019), issued during President Trump's first term, directed the Department of Health & Human Services to require that hospitals publicly disclose pricing information for shoppable services through a consumerfriendly display and in machine-readable format ("MRF") to support consumer decisionmaking.9 Following Executive Order 13877, the Centers for Medicare & Medicaid Services ("CMS") issued the Hospital Price Transparency rule, effective January 1, 2021, requiring hospitals to publish pricing information, including for certain shoppable services./10 The TrumpVance Administration has taken further strides to promote price transparency through Executive Order 14221 (2025), which directs relevant cabinet secretaries to take all necessary actions to require disclosure of actual prices, not merely estimates, and standardization of how pricing information is presented across hospitals and health plans./11 CMS then expanded price transparency requirements effective January 1, 2026./12 CMS also has implemented the No Surprises Act and related regulations to protect consumers, providing safeguards against surprise medical billing, including requirements for issuing good-faith estimates./13
CMS price-transparency rules, which are administered and enforced by CMS, establish a critical foundation for ensuring that healthcare facilities provide information to consumers related to pricing./14 These rules are, however, a regulatory floor: compliance with CMS requirements does not mean that a hospital has met its obligations under Section 5 of the FTC Act, which prohibits unfair or deceptive acts or practices in the marketplace./15 In other words, the CMS rules do not provide a safe harbor from liability under the FTC Act.
Under Section 5, the price of healthcare services is a material term./16 This means that clear and conspicuous disclosures are often necessary to prevent consumers from being deceived./17 Accordingly, failing to disclose the price of a healthcare service may be deceptive if it is likely to mislead consumers acting reasonably under the circumstances./18 Even when some price terms are disclosed, disclosures may be deceptive when they are incomplete--such as when they omit certain charges like physician fees or facility fees, or cover only a portion of the expected care--because consumers may reasonably believe they have been provided the total cost of care. Likewise, inaccurate disclosures mislead consumers and cause substantial harm.
Failure to provide transparent pricing may also be "unfair" under Section 5 if it causes or is likely to cause substantial injury to consumers that is not reasonably avoidable by consumers themselves and not outweighed by countervailing benefits to consumers or competition./19 For example, when price information is incomplete, inaccurate, or not provided sufficiently in advance for scheduled services, consumers cannot compare competing healthcare providers' services or make informed decisions. Nor do incomplete, inaccurate, or untimely pricing disclosures (where that information is reasonably available to the healthcare provider in advance) provide any countervailing benefits to competition or consumers. On the contrary, it undermines competition by obscuring one of the most important dynamics of competition from consumers' observation and comparison.
Accordingly, the FTC encourages you and all healthcare-service providers in the United States to conduct a comprehensive review of your price-transparency practices to ensure you are providing consumers with timely, accurate, and complete pricing for healthcare services, especially those scheduled in advance, and, if you are not, to take corrective action swiftly. The FTC will continue to monitor the healthcare marketplace and take enforcement action as warranted.
This letter is not intended to reflect a particularized assessment of your pricetransparency practices, nor is it intended to reflect a conclusion as to whether you have engaged in conduct violative of the FTC Act. If you have any questions about this letter, please contact the Bureau of Consumer Protection's Division of Advertising Practices at HealthcarePriceTransparency@ftc.gov. Sincerely, Andrew N. Ferguson Chairman Federal Trade Commission
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1/ 15 U.S.C. Sec. 45(a).
2/ See Fed. Trade Comm'n, Policy Statement on Deception, appended to In re Cliffdale Assocs., Inc., 103 F.T.C. 110 (1984). Among other requirements, the FTC Act requires that representations be truthful and non-misleading. See FTC v. Direct Mktg. Concepts, Inc., 624 F.3d 1, 8 (1st Cir. 2010).
3/ 15 U.S.C. Sec. 45(n); see Fed. Trade Comm'n, Policy Statement on Unfairness, appended to Int'l Harvester Co., 104 F.T.C. 949 (1984).
4/ See Fed. Trade Comm'n, FTC Chairman Andrew N. Ferguson Launches Healthcare Task Force (Mar. 20, 2026), https://www.ftc.gov/news-events/news/press-releases/2026/03/ftc-chairman-andrew-n-ferguson-launcheshealthcare-task-force.
5/ E.g., Complaint, FTC v. Greystar Real Estate Partners, No. 1:25-cv-00165 (D. Colo. Jan. 16, 2025).
6/ E.g., Complaint, FTC v. Live Nation Ent., No. 2:25-cv-8884 (C.D. Cal. Sept. 18, 2025); see also Trade Regulation Rule on Unfair or Deceptive Fees, 16 C.F.R. pt. 464 (effective May 5, 2025).
7/ E.g., Complaint, FTC v. Instacart, No. 3:25-cv-10783 (N.D. Cal. Dec. 18, 2025).
8/ E.g., Complaint, FTC v. Lindsay Chevrolet, No. 1:24-cv-02362 (E.D. Va. Dec. 27, 2024).
9/ Exec. Order No. 13,877, 84 Fed. Reg. 30,849-50 (June 27, 2019).
10/ See 45 C.F.R. pt. 180; see also 84 Fed. Reg. 65,524 (Nov. 27, 2019). The 2021 rule requires hospitals to publicly disclose standard charges by (1) posting a file in MRF containing all standard charges for all hospital items and services; and (2) providing a consumer-friendly display of standard charges for at least 300 shoppable services. See Ctrs. for Medicare & Medicaid Servs., CY 2020 Hospital Outpatient Prospective Payment System (OPPS) Policy Changes: Hospital Price Transparency Requirements (CMS 1717 F2) (Nov. 15, 2019), https://www.cms.gov/newsroom/fact-sheets/cy-2020-hospital-outpatient-prospective-payment-system-opps-policychanges-hospital-price.
11/ Exec. Order No. 14221, 90 Fed. Reg. 11,005-06 (Feb. 28, 2025).
12/ See 45 C.F.R. Sec. 180.50. CMS expanded price-transparency requirements consistent with Exec. Order 14,221, by replacing "estimated allowed amount" with standardized data elements: median, 10th percentile, and 90th percentile values of the allowed amounts in dollars, as well as the total count of allowed amounts. CMS also implemented stricter MRF rules by requiring hospitals to attest to the completeness and accuracy of the posted standard charge information and to identify an official responsible for ensuring data accuracy. See Ctrs. for Medicare & Medicaid Servs., CY 2026 OPPS and Ambulatory Surgical Center Final Rule - Hospital Price Transparency Policy Changes (CMS-1834-FC) (Nov. 21, 2025), https://www.cms.gov/newsroom/fact-sheets/cy-2026-opps-ambulatory-surgicalcenter-final-rule-hospital-price-transparency-policy-changes.
13/ See 42 U.S.C. Sec. 300gg-136 (2024); see also 45 C.F.R. pt. 149 (2025).
14/ According to recent reports, CMS has warned over 500 hospitals that they have failed to comply with CMS's expanded price-transparency requirements. See Josh Boak, Trump Administration Warns Over 500 Hospitals to Provide More Price Information or Face Fines, Associated Press (June 9, 2026), https://apnews.com/article/trumphospital-prices-healthcare-affordability-313817c2ba73f1a3f4055ecde27b82be; see also Ctrs. for Medicare & Medicaid Servs., Hospital Price Transparency Enforcement Updates, (Apr. 26, 2023), https://www.cms.gov/newsroom/fact-sheets/hospital-price-transparency-enforcement-updates.
15/ See 15 U.S.C. Sec. 45.
16/ See Policy Statement on Deception, supra n. 2, at 175 (information about cost of a service a material term).
17/ See id. at 176 ("Some cases involve omission of material information, the disclosure of which is necessary to prevent the claim, practice, or sale from being misleading."). To be effective, disclosures must be clear and conspicuous. See, e.g., Thompson Med. Co., 104 F.T.C. 648, 842-43 (1984), aff'd, 791 F.2d 189 (D.C. Cir. 1986); see generally Removatron Int'l Corp. v. F.T.C., 884 F.2d 1489, 1498-1501 (1st Cir. 1989); see also Cyberspace.com, 453 F.3d at 1200-01 (holding that fine print statement may be insufficient to correct a misleading representation); Kraft, Inc. v. FTC, 970 F.2d 311, 326 (7th Cir. 1992) (holding that to correct inaccurate impressions contributing to consumer deception, disclosures must be prominent and unambiguous); FTC v. Direct Mktg. Concepts, Inc., 624 F.3d at 12 (holding that disclaimers do not cure deception unless they are "sufficiently prominent and unambiguous" to change the impression of the advertisement).
18/ See Policy Statement on Deception, supra n. 2, at 175; see also FTC v. Gill, 265 F.3d 944, 950 (9th Cir. 2001) ("An act or practice is deceptive if 'first, there is a representation, omission, or practice that, second, is likely to mislead consumers acting reasonably under the circumstances, and third, the representation, omission, or practice is material.'"); see also FTC v. Pantron I Corp., 33 F.3d 1088, 1095 (9th Cir. 1994) (citing Cliffdale Assocs., 103 F.T.C. at 164-65). To be material, a claim must convey information that is important to consumers and thus be likely to affect their choice of a product. See FTC v. Cyberspace.com, LLC, 453 F.3d 1196, 1201 (9th Cir. 2006) (citing Cliffdale Assocs., 103 F.T.C. at 165).
19/ FTC Act Sec. 5(n), 15 U.S.C. Sec.45(n); see also Policy Statement on Unfairness, supra n. 3, at 1070-76.
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Original text here: https://www.ftc.gov/system/files/ftc_gov/pdf/Hospital-Letter-Template.pdf
CFTC Chairman Selig Issues Remarks at Fordham Law Blockchain Regulatory Symposium
WASHINGTON, Oct. 6 -- The Commodity Futures Trading Commission issued the following remarks by Chairman Michael S. Selig:
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Remarks at the Fordham Law Blockchain Regulatory Symposium
New York, NY | October 05, 2026
Chris, thank you for the kind introduction. It's great to be back with you in New York City. It feels like just yesterday that we were sitting together talking shop in Willkie's offices down the street. After having had the opportunity to work with you at the Commission and in private practice, it's an incredible honor to now follow in your footsteps as Chairman of the Commodity ... Show Full Article WASHINGTON, Oct. 6 -- The Commodity Futures Trading Commission issued the following remarks by Chairman Michael S. Selig: * * * Remarks at the Fordham Law Blockchain Regulatory Symposium New York, NY | October 05, 2026 Chris, thank you for the kind introduction. It's great to be back with you in New York City. It feels like just yesterday that we were sitting together talking shop in Willkie's offices down the street. After having had the opportunity to work with you at the Commission and in private practice, it's an incredible honor to now follow in your footsteps as Chairman of the CommodityFutures Trading Commission (CFTC). But there will always be only one "CryptoDad."
You once said "we owe it to this new generation to respect their enthusiasm about [crypto] with a thoughtful and balanced response, not a dismissive one."[1] I hope the regulatory initiatives that I'll be sharing with you all today demonstrate that the CFTC is committed to doing so.
But before I begin, I must note that the views I share today are my own as Chairman and don't necessarily reflect those of the Commission.
Satoshi's Revolution
In the wake of the dot-com bubble, Professor Carlota Perez observed in her seminal work Technological Revolutions and Financial Capital that transformational technologies, like the printing press, railroad, and internet, all result in a similar structure of technological revolution. She explained that each revolution begins with the
. . . replacement of one set of technologies by another . . . Investment in the new industries is carried out by new entrepreneurs while the young financial tycoons create a whirlpool that sucks in huge amounts of the world's wealth to reallocate it in more adventurous or reckless hands . . . Eventually, it has to collapse. But when it does, the changeover has been made. . . . the new way of doing things with new technologies has become 'common sense.' . . . Though the debate about the causes and the culprits can go on forever, the more practical task of setting up an adequate regulatory system and a set of effective safeguards is soon undertaken. Thanks to the crash and the recession, there is a newfound readiness to accept such rules on the part of the - until recently arrogant - financial wizards, now sobered up. If, at this turning point, the institutional adjustment is successfully achieved, what follows may be a golden age.[2]
Nearly two decades ago, Satoshi Nakamoto published a white paper called "Bitcoin: A Peer-to-Peer Electronic Cash System"[3] that was the big-bang of a new universe of decentralized networks, applications, and assets. The white paper described a "system based on cryptographic proof instead of trust, allowing any two parties to transact directly with each other without the need for a trusted third party."[4] Several months later, Nakamoto released the open-source Bitcoin Core software, creating the very first blockchain network and crypto asset.[5] Unlike other networks, Bitcoin is decentralized both politically and architecturally - no single person controls it and it has no central point of failure - but it's logically centralized in that it requires a distributed set of nodes to reach consensus on the system's state to function as a single virtual computer.[6]
Bitcoin didn't immediately catch on.[7] But soon the software initially adopted solely by "cypherpunks" at the fringes of the technological frontier had inspired a new generation of builders across the world.
One of those innovators was Vitalik Buterin, who developed his own white paper describing a blockchain network called Ethereum.[8] Buterin iterated upon Nakamoto's design for a trust-minimized[9] virtual computer shared across a network of peers[10] and created a Turing-complete system that supported programmable smart contracts. Unlike Nakamoto's bitcoin, Buterin designed Ethereum as a general-purpose protocol that would "allow other decentralized applications to build on top of it."[11] The network's native crypto asset - ether - would serve an essential role as "gas," required to run transactions on the protocol. Armed with this technology and a new programming language called Solidity, developers across the world set out to create new decentralized applications.
Blockchain technology "combine[d] the openness of democracy and the Internet with the merit of markets" and made it possible to "port the market model to places where it couldn't go before."[12] A blockchain's core software, running on each network participant's hardware, dictates the terms of network consensus and each participant is incentivized to follow these rules, minimizing trust in any individual participant.
This remedied what Marc Andreessen has referred to as the "original sin" of the internet - its lack of a native property ownership protocol.[13] As the economist Hernando de Soto has observed, the ability to own property with the assurance that it will not arbitrarily be taken away transforms property into capital and unleashes its potential energy into the broader economy.[14] In contrast to the offline world, the internet allowed users to read and write, but not to own value without reliance on a trusted party.[15] Without a native property ownership system, intermediaries stepped in to perform this function and users, startups, and creators were left reliant on centralized platforms that could change the rules on them at any time.[16] The open and merit-based market model of the blockchain brought permissionless innovation back to the internet, made it possible to own and transfer value without a bank account or subscription service, and turned network users into network stakeholders.[17]
This new ability to represent virtually anything and everything as a crypto asset on a blockchain led to a "Cambrian explosion"[18] of crypto assets on general-purpose blockchain networks like Ethereum, Cosmos, and Solana. We saw the invention of entirely new categories of programmable digital objects with varying degrees of external dependencies.[19] While the very first crypto assets were designed to function as currencies, many that followed were intended to be commodities that performed a specific role in a decentralized network or application and derived their value from network effects. We also saw the "tokenization" of a wide range of real-world assets, such as stocks, dollars, precious metals, and even jpegs.
Although Nakamoto's vision was for a virtual economy without trusted intermediaries, centralized crypto asset exchanges and brokerages soon emerged to meet demand for on- and off-ramps to the frontier. Many of the earliest exchanges and brokerages formed offshore before imploding in the wake of devastating cyber-attacks and rampant fraud.[20] Others chose to attempt to navigate a complex regulatory landscape in the United States.
After the collapse of a popular offshore exchange, state banking regulators across the country deemed crypto assets to be a form of "money" or "currency" under their respective state money transmission statutes and required exchanges and brokerages to be licensed as money transmitters. State money transmission laws originated in the early 1900s to protect customers of non-bank service providers from fraud and insolvency in connection with remittances and payments.[21] Exchanges and brokerages soon found themselves licensed in up to fifty states and territories, alongside gift card issuers and check cashers. These state regimes required licensees to perform important functions, such as know-your-customer and anti-money laundering checks, but did not require licensees to institute market-based protections that are typical under federal market regulatory regimes, such as orderly trading requirements, anti-manipulation rules, and mitigation of conflicts of interest. Nor did these regimes contemplate separate licenses and requirements for brokering, dealing, executing, and clearing trades.
As crypto exploded in popularity, issuers of new crypto assets began to sell their coins directly to the public in what came to be known as "initial coin offerings."[22] Without clear rules of the road, consumers had difficulty discerning the legitimate projects from the fraudulent ones, and trouble distinguishing the Pets.com's from the Amazon's. Like the dot-com bubble before it, the "ICO" bubble eventually burst, and a "crypto winter" set in. But the builders continued to innovate, designing new network layers, protocols, and products. Winter gave way to "crypto spring" and "defi summer," and each cycle a new class of builders entered the fray.
1) What
When the news broke about FTX, it was a slow drip over hours, days, and weeks. A CoinDesk article questioned the company's balance sheet.[23] Another exchange's chief executive publicly expressed skepticism about the company's financials. FTX's founder, Sam Bankman-Fried, followed with the infamous "1) What" tweet.[24] FTX's lenders then struggled to figure out what to do with the "FTT" tokens they held as collateral.[25] Founders and investors frantically called their lawyers and advisors for help. Distressed funds circled the wreckage, picking through FTT and other stranded tokens at collapsed prices as firms raced to salvage whatever value remained. Meanwhile, lawyers and advisors anxiously refreshed their browsers for the latest installment of Matt Levine's daily coverage of the debacle.[26]
Eventually it came to light that FTX's operators stole more than $8 billion in exchange customer assets to engage in their own proprietary investments. Although FTX had a U.S. subsidiary with state money transmitter licenses, its customers' funds were nowhere to be found. However, the customer property held by FTX's CFTC-registered subsidiaries remained segregated and secure. A credit to the agency's robust customer safeguards and market surveillance.
As Professor Perez observed, eventually the euphoria ends, but when it does "the new way of doing things with new technologies has become 'common sense.'"[27] FTX's implosion reverberated throughout the global crypto markets and ushered in a crypto winter unlike any the industry had seen before, but the technology persevered.
This is when the American crypto industry learned "[t]he nine most terrifying words in the English language . . . I'm from the Government, and I'm here to help."[28]
Regulation in One Lesson
Governments across the globe scrambled to respond to FTX's collapse as crypto asset intermediaries across the world continued to fall. In the ensuing months and years, legislators and regulators convened hearings, roundtables, and studies to support the development of new laws and regulations for crypto markets. Dozens of countries then established comprehensive regulatory regimes. The European Union codified MiCA,[29] the United Kingdom issued crypto market rules under FSMA,[30] and Singapore instituted regulations for digital token service providers.[31]
In the United States, the CFTC and Securities and Exchange Commission (SEC) took a different approach. The agencies chose to utilize their existing statutory authorities not to write new rules for these markets, but to regulate them by enforcement.
Before enforcement came to define the federal government's approach to crypto, both agencies spent half a decade attempting to chart a regulatory path for crypto assets.
In 2014, former CFTC Chairman Timothy Massad declared bitcoin to be a "commodity" within the Commission's regulatory scheme.[32] The CFTC later greenlit the first regulated bitcoin futures contracts under the leadership of former Chairman Chris Giancarlo.[33] In the years that followed, former Chairman Heath Tarbert set forth his views as Chairman when he deemed ether to be a "commodity" and, under his leadership, the agency finalized interpretive guidance concerning the term "actual delivery" in relation to crypto assets.[34]
Around this time, the SEC staff followed with a "framework"[35] on investment contracts involving crypto assets and several no-action letters to crypto asset issuers clarifying that their coin offerings would not be subject to registration with the agency.[36] With more than 50 subjective factors to navigate, and no further guidance from the SEC, market participants resorted to creating a dedicated "Crypto Rating Council" to score, on a 1-5 scale, the likelihood of a crypto asset being deemed to be a security.[37] Lawyers started churning out reasoned Howey memos in attempts to untie a Gordian knot of almost a century of case law concerning orange groves, payphones, chinchillas, and condominiums in transactions that bore almost no resemblance to the emergent, decentralized business models that were on the cusp of the new frontier of finance. A boon for lawyers' billable hours - not so much for American innovators.
Then, under the Biden administration, the agencies quickly shifted course to regulation by enforcement - a trend that amplified dramatically in the wake of FTX's downfall. Crypto no-action letters quickly became historical artifacts of a bygone era after regulators closed their doors to productive discussions with market participants.
The CFTC used its authority over "retail commodity transactions" under section 2(c)(2)(D) of the Commodity Exchange Act (CEA) to charge several operators of centralized exchanges and developers of decentralized exchange protocols for offering transactions that are required to be executed on a CFTC-registered exchange, known as a designated contract market (or DCM).[38] The agency proceeded with these investigations and lawsuits despite the lack of clear rules, interpretations, or relief needed to make on-exchange trading of crypto assets possible.
In one case, the CFTC obtained a default judgment against a decentralized autonomous organization after serving process on the protocol by messaging an online "help chat box" on its website.[39] In another, the agency fined a software developer for offering a user interface for an automated market maker protocol that enabled users to interact with smart contracts to engage in off-exchange retail commodity transactions.[40]
The status of a given crypto asset as a "commodity" within the CFTC's remit could only be determined based upon a review of the non-exhaustive list of assets included in each lawsuit and cross-reference against the copious list of "crypto asset securities" included in the SEC's lawsuits.[41] Yet it wasn't even clear that the heads of the two agencies agreed on which assets were and weren't securities.
Under former SEC Chairman Gary Gensler's leadership, the agency similarly charged operators of centralized exchanges and developers of decentralized protocols with failure to register as broker-dealers and national securities exchanges. He glibly directed new entrants to fill out "a form on our website" to register without making any modifications to the SEC's rules or regulations to accommodate the technology.[42]
This may have been a golden age for the Cayman Islands legal bar, which gladly incorporated hundreds of offshore foundation companies for crypto projects, but it was the dark ages for the United States. After the onslaught, few crypto firms remained in the country, each clinging to every word of Commissioner Hester Peirce's dissenting statements to keep the faith.[43]
Hard Fork
After President Trump took office last year, the President's Working Group on Digital Asset Markets quickly instituted a hard fork from these Biden era policies.
SEC Chairman Atkins and I partnered together on Project Crypto to modernize our agencies' rules and regulations to allow our markets to move onchain. As part of this initiative, the CFTC and SEC codified a joint interpretation to put Gary Gensler's "embodiment theory" of security status to bed once and for all.[44] Our joint interpretation classified crypto assets into five general categories: digital commodities,[45] digital collectibles,[46] digital tools,[47] stablecoins,[48] and digital securities.[49] The interpretation clarified that the first three categories are generally not securities, stablecoins may in some cases be structured as securities, and digital securities are, of course, securities. The interpretation also explains how a non-security crypto asset offered or sold as part of an investment contract security may separate from the investment contract and no longer be subject to the federal securities laws.[50]
The SEC subsequently proposed Regulation Crypto Assets to establish a purpose-fit regulatory framework for offerings of investment contracts involving crypto assets and a security status "safe harbor" for crypto assets sold in these offerings.[51] The administration delivered the clarity, certainty, and investor protections that crypto projects and participants demanded for American crypto asset distributions.
A New Path Forward: Regulation CTX and Regulation CAM
Now, I'm disappointed that Congress failed to deliver the Clarity Act to the President's desk. This legislation would have codified in statute the line that Chairman Atkins and I have drawn between securities and non-securities, mandated that centralized crypto asset exchanges and brokerages register with the CFTC, and instituted purpose-fit core principles for these new CFTC registrants. But President Trump promised to deliver a crypto asset regulatory market structure with or without legislation, and we will help him deliver it using our existing statutory authorities.
Today, the CFTC is doing its part to deliver clear rules of the road for crypto asset markets with its advanced notice of proposed rulemaking on Regulation Crypto Asset Transactions (Regulation CTX) and Regulation Crypto Asset Markets (Regulation CAM), which is now live on the CFTC's website. These rules would codify a pathway for crypto asset exchanges to operate under uniform national oversight by the CFTC pursuant to the same statutory authorities that the prior administration instead utilized to regulate by enforcement.
I want to underscore that this is a federal option for crypto asset exchanges. Just like the banking regulatory system, where firms may choose to pursue either a federal or state charter, with each type of charter authorizing the firm to engage in differing types of permissible activities, crypto firms should be free to pursue state licenses or federal registrations based upon the products and services the firm intends to offer. Only Congress has the authority to mandate that all crypto asset exchanges register with the Commission. However, Congress has mandated that exchanges that wish to offer retail customers the ability to trade crypto assets on a margined, leveraged, or financed basis register with the agency. But the agency never used this authority to issue purpose-fit rules for these transactions or platforms, only to enforce.
You might envision a ladder. On the first rung of the ladder are ordinary spot crypto exchanges (Rung 1 Exchanges), which are subject to the CFTC's anti-fraud and anti-manipulation authority but are otherwise generally regulated under state money transmission laws. On the second rung are exchanges that also offer retail customers the ability to trade crypto assets on a margined, leveraged, or financed basis (Rung 2 Exchanges), which are required to register with the CFTC and subject to its exclusive regulation. On the third rung are exchanges that also allow customers to trade perps and all other types of derivatives (Rung 3 Exchanges), which are also required to register with the CFTC and subject to its exclusive jurisdiction.
Today's initial proposals would establish a regulatory framework for Rung 2 Exchanges--or firms offering retail customers the ability to trade crypto assets on a margined, leveraged, or financed basis. We refer to such a transaction as a CTX. Rung 3 Exchanges that are already registered with the CFTC as a DCM could begin offering trading in CTXs on their platforms under tailored rules. Non-registrants that wish to only offer CTXs could choose to either register as an ordinary DCM or pursue registration as a new sub-category of DCM called a "crypto asset market" (or CAM).
This provides firms with a clearer framework for evaluating how to best serve their customers in the United States and helps customers understand what protections apply to the platform they choose.
The CAM regime is designed for exchanges that only offer CTXs. To obtain designation as a CAM, an exchange would be required to adhere to the statutory DCM core principles, but with the benefit of a tailored set of regulations that are purpose-built and designed for CTXs. An exchange offering futures, options, or swaps would remain subject to the current DCM framework.
The statutory DCM core principles give us a sound starting point for the effective regulation of CAMs engaged in creating and administering national markets in CTXs. Principles 3 and 4 address contract listings and market surveillance.[52] Principles 11 and 12 address financial integrity, customer funds, and abusive practices.[53] Principles 16 and 20 address conflicts and system safeguards.[54] For CAMs, the rules promulgated under these statutory obligations would address the specific risks posed by, and commercial realities of, CTXs.
For example, the statutory requirements of DCM Core Principle 3 require a CAM to show that a CTX is not readily susceptible to manipulation.[55] However, the considerations in ensuring compliance with that statutory obligation with respect to CTXs differ from the considerations that are relevant to more traditional CFTC-regulated products. When listing CTXs, DCMs and CAMs may have to consider the distribution method and concentration of crypto assets, lock-ups periods and vesting schedules, whether there are programmatic issuances or buybacks, and a flurry of other crypto asset-specific considerations related to manipulation risks. Many crypto asset exchanges already voluntarily employ purpose-fit procedures to prevent the listing of crypto assets that are readily susceptible to manipulation. The proposed Regulation CAM regime would codify best practices into regulatory obligations that will serve the interests of American markets and their retail participants. Similarly, the Regulation CAM proposal also contemplates a "proof-of-reserves" obligation for exchanges that maintain customer property in omnibus accounts held for their customers' benefit - a safeguard that I am sure would have benefitted FTX's retail customers.
The proposed rules further contemplate the required intermediation of CTXs by a futures commission merchant (or FCM). Those FCMs would manage customer accounts and funds, subject to the CEA's customer protection requirements, including disclosures,[56] capital requirements,[57] and customer property segregation,[58] among other areas. We are also examining and would welcome views on how FCM requirements should fit crypto asset activity while preserving clear responsibility for customer property, records, segregation, risk controls, and supervision. Requiring FCM intermediation of CTXs also ensures that customer-facing activity on a CAM would be subject to the Bank Secrecy Act's (BSA) applicable anti-money laundering, customer identification, and suspicious activity reporting requirements, along with the various other related legal and regulatory obligations that the BSA and Commission regulations impose on FCMs.[59]
For those who prefer to do things the way the cypherpunks originally envisioned, we aim to provide the clarity needed for onchain finance to flourish. Our statute provides an exception to the on-exchange trading requirement for CTXs that involve "actual delivery" of the commodity within 28 days. We propose to codify an interpretation of "actual delivery" to clarify that delivery of a crypto asset to a user's external, non-custodial digital wallet within 28 days generally satisfies this exception.
Onchain Finance
And, another aside on onchain finance. Although outside the scope of today's proposals, we are also exploring a durable policy for developers who publish software but do not solicit or take orders, control execution, or hold customer assets. A person should not have to register as an introducing broker simply because that person shipped code.
We are also working directly with builders to develop lawful pathways for onchain products in the United States. I've directed CFTC staff to engage with developers and founders to understand how onchain venues function, where control resides, how their activities compare to those performed by traditional market intermediaries, and how the CEA and our regulations apply to these new models.
American builders should have a clear path to bring new products to market here, under rules that protect customers and preserve market integrity, without sacrificing the features that make these technologies innovative in the first place.
And that brings me back to the broader purpose of the proposed framework I have outlined today.
Golden Age
As Professor Perez observed, technological revolutions have occurred and followed a similar course throughout human history. From the joint stock company to the railroad to the internet, new technologies are invariably dismissed, then abused by bad actors; there is a frenzy, a bubble, and an inevitable bust; at which point the technology has become common sense and regulators must craft rules for the new frontier. If the regulators get the rules right, they can usher in a golden age.
The framework I have outlined is an important step towards bringing crypto asset markets within the protections of the CEA. It will establish clear rules of the road for firms that want to serve American customers, strengthen the integrity of these markets, and provide a path for responsible innovation to take place here in America.
For years, entrepreneurs building on the new frontier of finance faced uncertainty about whether there was a place for them in our markets. We are giving them an answer.
Build here. Build markets that are open, competitive, and worthy of the public's trust. Build under American rules and American standards. And build knowing that responsible innovation has a place in the United States.
Satoshi's technological revolution has transformed global financial markets. If America can embrace this paradigm shift and get the right regulations in place, we can usher in a golden age like those that followed the transformative technologies of the past.[60]
Thank you, and I look forward to the fireside chat to follow.
* * *
[1] Virtual Currencies: The Oversight Role of the U.S. Securities and Exchange Commission and the U.S. Commodity Futures Trading Commission: Hearing Before the S. Comm. on Banking, Hous., & Urb. Affs., 115th Congress 6 (2018) (statement of J. Christopher Giancarlo, Chairman, CFTC).
[2] Carlota Perez, Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages 4-5 (2002).
[3] Satoshi Nakamoto, Bitcoin: A Peer-to-Peer Electronic Cash System (Oct. 31, 2008), available at https://bitcoin.org/bitcoin.pdf.
[4] Id.
[5] See Satoshi Nakamoto, Bitcoin P2P e-cash paper, Cryptography Mailing List, available at https://satoshi.nakamotoinstitute.org/emails/cryptography/1/ (Oct. 31, 2006).
[6] See Vitalik Buterin, Medium.com/@VitalikButerin, The Meaning of Decentralization (Feb. 8, 2017), available at https://medium.com/@VitalikButerin/the-meaning-of-decentralization-a0c92b76a274.
[7] Nakamoto explained that "[i]t might make sense just to get some in case it catches on. If enough people think the same way, that becomes a self-fulfilling prophecy." Satoshi Nakamoto, Cryptography Mailing List, Subject: Bitcoin v0.1 released (Jan. 17, 2009), available at https://satoshi.nakamotoinstitute.org/emails/cryptography/16/.
[8] See Vitalik Buterin, Ethereum: A Next-Generation Smart Contract and Decentralized Application Platform (Dec. 2014), available at https://ethereum.org/whitepaper/.
[9] "Using a calculator is a trustless activity, whereas investing in a guy named Bernie is not." Omid Malekan, Re-Architecting Trust: The Curse of History and the Crypto Cure for Money, Markets, and Platforms xiv (2022).
[10] See Nick Szabo, The dawn of trustworthy computing (Dec. 11, 2014), available at https://unenumerated.blogspot.com/2014/12/the-dawn-of-trustworthy-computing.html ("A block chain computer is a virtual computer, a computer in the cloud, shared across many traditional computers and protected by cryptography and consensus technology.").
[11] Vitalik Buterin, Bitcoin Magazine, Ethereum: A Next-Generation Cryptocurrency and Decentralized Application Platform (Jan. 23, 2014), available at https://bitcoinmagazine.com/business/ethereum-next-generation-cryptocurrency-decentralized-application-platform-1390528211.
[12] Naval Ravikant, @naval, X (June 21, 2017), available at https://x.com/naval/status/877467629308395521.
[13] Marc Andreessen & Katie Haun, From the Internet's Past to the Future of Crypto, The a16z Podcast (Aug. 29, 2019), available at https://a16z.com/podcast/a16z-podcast-from-the-internets-past-to-the-future-of-crypto/.
[14] Hernando de Soto, The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else (Basic Books 2000); see also David Hoffman, Ryan Sean Adams & Hernando de Soto, The Power of Property Rights with Hernando de Soto, Bankless (Nov. 30, 2023), available at https://www.bankless.com/a-property-rights-masterclass-with-hernando-de-soto ("This is a race to title the world [between the U.S. and China] . . . and if [the U.S.] partner[s] with blockchain, if [it] adopt[s] blockchain technologies, the win for the U.S. is that it can outcompete China to help title the world.").
[15] "The read era of the internet was defined by the website, which encapsulated information. The read-write era was defined by the post, which encapsulated publishing, making it easy for anyone, not just web developers, to reach broad audiences. The internet's latest phase--the read-write-own era--is defined by a new simplifying concept: tokens, which encapsulate ownership." Chris Dixon, Read Write Own, at 74 (2024).
[16] See id. at xiv.
[17] Chris Dixon distinguishes between "protocol networks," which are permissionless, "open systems controlled by communities of software developers and other network stakeholders" and "corporate networks," which are permissioned, owned and controlled by companies. See id. at xxi. See also Malekan, supra note 9 ("What is good for the owners inevitably comes at the expense of users, with management perpetually stuck in between.").
[18] Fred Ehrsam, Blockchain Governance: Programming Our Future (Nov. 27, 2017), available at https://www.fehrsam.xyz/blog/blockchain-governance-programming-our-future.
[19] Derek Edward Schloss, Storing Value in Digital Objects (Feb. 6, 2023), available at https://medium.com/collab-currency/storing-value-in-digital-objects-a92f54fa98cc.
[20] See, e.g., Robert McMillan, The Inside Story of Mt. Gox, Bitcoin's $460 Million Disaster, WIRED (Mar. 3, 2014), available at https://www.wired.com/2014/03/bitcoin-exchange/.
[21] See Congressional Research Service, Telegraphs, Steamships, and Virtual Currency: An Analysis of Money Transmitter Regulation, at 1 (Aug. 20, 2020), available at https://www.congress.gov/crs_external_products/R/PDF/R46486/R46486.2.pdf.
[22] Mike Orcutt, Despite shadiness and crackdowns, the ICO boom is bigger than ever, MIT Technology Review (July 3, 2018), available at https://www.technologyreview.com/2018/07/03/2534/despite-shadiness-and-crackdowns-the-ico-boom-is-bigger-than-ever/.
[23] Ian Allison, Divisions in Sam Bankman-Fried's Crypto Empire Blur on His Trading Titan Alameda's Balance Sheet, CoinDesk (Aug. 16, 2023), available at https://www.coindesk.com/business/2022/11/02/divisions-in-sam-bankman-frieds-crypto-empire-blur-on-his-trading-titan-alamedas-balance-sheet.
[24] @SBF_FTX, X (Nov. 13, 2022), available at https://x.com/SBF_FTX/status/1591989554881658880.
[25] See Complaint
69-74, SEC v. Ellison, No. 22-cv-10794 (S.D.N.Y. Dec. 21, 2022).
[26] See, e.g., Matt Levine, FTX Had Many Bad Spreadsheets, Bloomberg (Oct. 12, 2023), available at https://www.bloomberg.com/opinion/articles/2023-10-12/ftx-had-many-bad-spreadsheets.
[27] See Perez, supra note 2.
[28] Ronald Reagan Presidential Foundation & Institute, Reagan on Government (Aug. 12, 1986), available at https://www.reaganfoundation.org/ronald-reagan/quotes/the-nine-most-terrifying-words-in-the-english-language.
[29] Regulation (EU) 2023/1114 of the European Parliament and of the Council of 31 May 2023 on Markets in Crypto-Assets (MiCA), 2023 O.J. (L 150) 40, available at https://eur-lex.europa.eu/eli/reg/2023/1114/oj.
[30] Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026, SI 2026/102 (U.K.), available at https://www.legislation.gov.uk/uksi/2026/102; Financial Conduct Authority, PS26/11. Regulated Cryptoasset Activities (June 30, 2026), available at https://www.fca.org.uk/firms/new-regime-cryptoasset-regulation.
[31] Financial Services and Markets Act 2022, pt. 9 (Sing.), available at https://sso.agc.gov.sg/Act/FSMA2022; Financial Services and Markets (Digital Token Service Providers) Regulations 2025 (Sing.); see also Monetary Authority of Singapore, MAS Clarifies Regulatory Regime for Digital Token Service Providers (June 6, 2025), available at https://www.mas.gov.sg/news/media-releases/2025/mas-clarifies-regulatory-regime-for-digital-token-service-providers.
[32] CFTC Chairman Timothy Massad, Testimony Before the U.S. Senate Committee on Agriculture, Nutrition & Forestry (Dec. 10, 2014), available at https://www.cftc.gov/PressRoom/SpeechesTestimony/opamassad-6.
[33] CFTC, CFTC Statement on Self-Certification of Bitcoin Products by CME, CFE and Cantor Exchange, Release No. 7654-17 (Dec. 1, 2017) (quoting former Chairman J. Christopher Giancarlo), available at https://www.cftc.gov/PressRoom/PressReleases/7654-17.
[34] See Retail Commodity Transactions Involving Certain Digital Assets, 85 FR 37734 (June 24, 2020) (later withdrawn).
[35] SEC, Div. of Corp. Fin., Framework for "Investment Contract" Analysis of Digital Assets (Apr. 3, 2019), available at https://www.sec.gov/files/dlt-framework.pdf (later withdrawn).
[36] See, e.g., SEC, Div. of Corp. Fin., Response of the Division of Corporation Finance Re: Pocketful of Quarters, Inc. (July 25, 2019), available at https://www.sec.gov/corpfin/pocketful-quarters-inc-072519-2a1; SEC, Div. of Corp. Fin., Response of the Division of Corporation Finance Re: IMVU, Inc. (Nov. 19, 2020), available at https://www.sec.gov/rules regulations/no-action-interpretive-exemptive-letters/division-corporation-finance-no-action/imvu-111920-2a1.
[37] Coinbase, Introducing the Crypto Rating Council (Sep. 30, 2019), available at https://www.coinbase.com/blog/introducing-the-crypto-rating-council ("Although the [SEC] has issued helpful guidance, whether any given crypto asset is a security ultimately requires a fact-intensive analysis by knowledgeable technical and securities law experts. This analysis is difficult and expensive to operationalize consistently, may involve judgment calls, and can lead to disagreement among legal experts (and even government officials). This challenge prompted Coinbase to bring together several industry leaders and securities law experts to create a scalable, points-based rating system centered around a set of several dozen, yes / no factual questions. These questions are derived directly from SEC guidance and case law and are designed to address important characteristics that inform whether an asset is or is not a security.").
[38] See, e.g., In re Payward Ventures, Inc. (d/b/a Kraken), CFTC No. 21-20 (Sept. 28, 2021); CFTC, CFTC Issues Orders Against Operators of Three DeFi Protocols for Offering Illegal Digital Asset Derivatives Trading, Release No. 8774-23 (Sept. 7, 2023), available at https://www.cftc.gov/PressRoom/PressReleases/8774-23; CFTC, CFTC Issues Order Against Uniswap Labs for Offering Illegal Digital Asset Derivatives Trading, Release No. 8961-24 (Sept. 4, 2024), available at https://www.cftc.gov/PressRoom/PressReleases/8961-24.
[39] See Proskauer, From Code to Consequence: CFTC Obtains Default Judgment Against Ooki DAO for Commodity Exchange Act Violations, Blockchain and the Law (July 20, 2023), available at https://www.proskauer.com/blog/from-code-to-consequence-cftc-obtains-default-judgment-against-ooki-dao-for-commodity-exchange-act-violations.
[40] See CFTC Issues Order Against Uniswap Labs for Offering Illegal Digital Asset Derivatives Trading, Release No. 8961-24 (Sep. 4, 2024), available at https://www.cftc.gov/PressRoom/PressReleases/8961-24.
[41] See Gary Gensler, "Partners of Honest Business and Prosecutors of Dishonesty": Remarks by Chair Gensler Before the 2023 Securities Enforcement Forum (Oct. 26, 2023), available at https://www.sec.gov/newsroom/speeches-statements/gensler-remarks-securities-enforcement-forum-102523. (". . . crypto intermediaries--transacting in these crypto asset securities--are subject to the securities laws as well.").
[42] See First on CNBC: CNBC Transcript: SEC Chair Gary Gensler Speaks with CNBC's "Squawk Box" Today, CNBC (Feb. 10, 2023), available at https://www.cnbc.com/2023/02/10/first-on-cnbc-cnbc-transcript-sec-chair-gary-gensler-speaks-with-cnbcs-squawk-box-today.html.
[43] Commissioner Peirce dissented to more than 15 SEC actions and authored more than 10 critical speeches related to crypto issues during these years.
[44] See Application of the Federal Securities Laws to Certain Types of Crypto Assets and Certain Transactions Involving Crypto Assets, 91 FR 13714, 13715 n. 1 (Mar. 23, 2026) ("Joint Crypto Asset Taxonomy").
[45] Id., at 13718, providing that a digital commodity is a crypto asset that is intrinsically linked to and derives its value from the programmatic operation of a crypto system that is functional, as well as supply and demand dynamics, rather than from the expectation of profits from the essential managerial efforts of others. In the Joint Crypto Asset Taxonomy, the Commissions provided their views as to examples of digital commodities, which include, among others, Bitcoin (BTC); Ether (ETH); Solana (SOL); Stellar (XLM); Tezos (XTZ); and XRP (XRP).
[46] See id. at 13718, providing that a digital collectible is a crypto asset that is designed to be collected and/or used and may represent or convey rights to artwork, music, videos, trading cards, in-game items, or digital representations or references to internet memes, characters, current events, or trends, among other things. A digital collectible does not have intrinsic economic properties or rights, such as generating a passive yield or conveying rights to future income, profits, or assets of a business enterprise or other entity, promisor, or obligor.
[47] See id. at 13719, providing that a digital tool is a crypto asset that performs a practical function, such as a membership, ticket, credential, title instrument, or identity badge. Digital tools are commonly issued for use in connection with crypto systems and are designed to perform practical functions within such systems. Digital tools often are non-transferrable or "soul-bound," and their value is derived from their practical functionality.
[48] See id. at 13720, providing that a stablecoin is a crypto asset that is designed to maintain a stable value relative to a reference asset like the U.S. dollar.
[49] See id. at 13720, providing that a digital security (commonly known as a "tokenized" security) is a financial instrument enumerated in the definition "security" that is formatted as or represented by a crypto asset, where the record of ownership is maintained in whole or in part on or through one or more crypto networks.
[50] Id. at 13722-3. The Joint Crypto Asset Taxonomy set forth the Commissions' view that a non-security crypto asset would no longer be subject to an investment contract when: (1) the issuer has fulfilled its representations or promises to engage in essential managerial efforts, or (2) the purchaser would not reasonably expect the issuer to be able to fulfill or to continue to engage in the essential managerial efforts it represented or promised it would undertake.
[51] SEC, Regulation Crypto Assets, 91 FR 54510 (proposed Aug. 21, 2026).
[52] CEA 5(d)(3), 7 U.S.C. 7(d)(3); CEA 5(d)(3), 7 U.S.C. 7(d)(4).
[53] CEA 5(d)(11), 7 U.S.C. 7(d)(11); CEA 5(d)(12), 7 U.S.C. 7(d)(12).
[54] CEA 5(d)(16), 7 U.S.C. 7(d)(16); CEA 5(d)(20), 7 U.S.C. 7(d)(20).
[55] CEA 5(d)(3), 7 U.S.C. 7(d)(3).
[56] 17 CFR 1.55.
[57] CEA 4f(b), 7 U.S.C. 6f(b).
[58] CEA 4d(a)(2), 7 U.S.C. 6d(a)(2).
[59] See, e.g., 17 CFR 42.2. The legal and regulatory obligations under the BSA applicable to FCMs support the detection and prevention of money laundering and other illicit financial activity, facilitate regulatory oversight of such FCMs' compliance controls, and require the provision of relevant information to law enforcement authorities.
[60] In other words, "[i]f your idea of money is what it was yesterday, you will lose it to the people who know what money will be tomorrow." Naval Ravikant, @naval, X (Sep. 23, 2021), available at https://x.com/naval/status/1440954808052039684.
* * *
Original text here: https://www.cftc.gov/PressRoom/SpeechesTestimony/opaselig12
* * *
Remarks at the Fordham Law Blockchain Regulatory Symposium
New York, NY | October 05, 2026
Chris, thank you for the kind introduction. It's great to be back with you in New York City. It feels like just yesterday that we were sitting together talking shop in Willkie's offices down the street. After having had the opportunity to work with you at the Commission and in private practice, it's an incredible honor to now follow in your footsteps as Chairman of the Commodity ... Show Full Article WASHINGTON, Oct. 6 -- The Commodity Futures Trading Commission issued the following remarks by Chairman Michael S. Selig: * * * Remarks at the Fordham Law Blockchain Regulatory Symposium New York, NY | October 05, 2026 Chris, thank you for the kind introduction. It's great to be back with you in New York City. It feels like just yesterday that we were sitting together talking shop in Willkie's offices down the street. After having had the opportunity to work with you at the Commission and in private practice, it's an incredible honor to now follow in your footsteps as Chairman of the CommodityFutures Trading Commission (CFTC). But there will always be only one "CryptoDad."
You once said "we owe it to this new generation to respect their enthusiasm about [crypto] with a thoughtful and balanced response, not a dismissive one."[1] I hope the regulatory initiatives that I'll be sharing with you all today demonstrate that the CFTC is committed to doing so.
But before I begin, I must note that the views I share today are my own as Chairman and don't necessarily reflect those of the Commission.
Satoshi's Revolution
In the wake of the dot-com bubble, Professor Carlota Perez observed in her seminal work Technological Revolutions and Financial Capital that transformational technologies, like the printing press, railroad, and internet, all result in a similar structure of technological revolution. She explained that each revolution begins with the
. . . replacement of one set of technologies by another . . . Investment in the new industries is carried out by new entrepreneurs while the young financial tycoons create a whirlpool that sucks in huge amounts of the world's wealth to reallocate it in more adventurous or reckless hands . . . Eventually, it has to collapse. But when it does, the changeover has been made. . . . the new way of doing things with new technologies has become 'common sense.' . . . Though the debate about the causes and the culprits can go on forever, the more practical task of setting up an adequate regulatory system and a set of effective safeguards is soon undertaken. Thanks to the crash and the recession, there is a newfound readiness to accept such rules on the part of the - until recently arrogant - financial wizards, now sobered up. If, at this turning point, the institutional adjustment is successfully achieved, what follows may be a golden age.[2]
Nearly two decades ago, Satoshi Nakamoto published a white paper called "Bitcoin: A Peer-to-Peer Electronic Cash System"[3] that was the big-bang of a new universe of decentralized networks, applications, and assets. The white paper described a "system based on cryptographic proof instead of trust, allowing any two parties to transact directly with each other without the need for a trusted third party."[4] Several months later, Nakamoto released the open-source Bitcoin Core software, creating the very first blockchain network and crypto asset.[5] Unlike other networks, Bitcoin is decentralized both politically and architecturally - no single person controls it and it has no central point of failure - but it's logically centralized in that it requires a distributed set of nodes to reach consensus on the system's state to function as a single virtual computer.[6]
Bitcoin didn't immediately catch on.[7] But soon the software initially adopted solely by "cypherpunks" at the fringes of the technological frontier had inspired a new generation of builders across the world.
One of those innovators was Vitalik Buterin, who developed his own white paper describing a blockchain network called Ethereum.[8] Buterin iterated upon Nakamoto's design for a trust-minimized[9] virtual computer shared across a network of peers[10] and created a Turing-complete system that supported programmable smart contracts. Unlike Nakamoto's bitcoin, Buterin designed Ethereum as a general-purpose protocol that would "allow other decentralized applications to build on top of it."[11] The network's native crypto asset - ether - would serve an essential role as "gas," required to run transactions on the protocol. Armed with this technology and a new programming language called Solidity, developers across the world set out to create new decentralized applications.
Blockchain technology "combine[d] the openness of democracy and the Internet with the merit of markets" and made it possible to "port the market model to places where it couldn't go before."[12] A blockchain's core software, running on each network participant's hardware, dictates the terms of network consensus and each participant is incentivized to follow these rules, minimizing trust in any individual participant.
This remedied what Marc Andreessen has referred to as the "original sin" of the internet - its lack of a native property ownership protocol.[13] As the economist Hernando de Soto has observed, the ability to own property with the assurance that it will not arbitrarily be taken away transforms property into capital and unleashes its potential energy into the broader economy.[14] In contrast to the offline world, the internet allowed users to read and write, but not to own value without reliance on a trusted party.[15] Without a native property ownership system, intermediaries stepped in to perform this function and users, startups, and creators were left reliant on centralized platforms that could change the rules on them at any time.[16] The open and merit-based market model of the blockchain brought permissionless innovation back to the internet, made it possible to own and transfer value without a bank account or subscription service, and turned network users into network stakeholders.[17]
This new ability to represent virtually anything and everything as a crypto asset on a blockchain led to a "Cambrian explosion"[18] of crypto assets on general-purpose blockchain networks like Ethereum, Cosmos, and Solana. We saw the invention of entirely new categories of programmable digital objects with varying degrees of external dependencies.[19] While the very first crypto assets were designed to function as currencies, many that followed were intended to be commodities that performed a specific role in a decentralized network or application and derived their value from network effects. We also saw the "tokenization" of a wide range of real-world assets, such as stocks, dollars, precious metals, and even jpegs.
Although Nakamoto's vision was for a virtual economy without trusted intermediaries, centralized crypto asset exchanges and brokerages soon emerged to meet demand for on- and off-ramps to the frontier. Many of the earliest exchanges and brokerages formed offshore before imploding in the wake of devastating cyber-attacks and rampant fraud.[20] Others chose to attempt to navigate a complex regulatory landscape in the United States.
After the collapse of a popular offshore exchange, state banking regulators across the country deemed crypto assets to be a form of "money" or "currency" under their respective state money transmission statutes and required exchanges and brokerages to be licensed as money transmitters. State money transmission laws originated in the early 1900s to protect customers of non-bank service providers from fraud and insolvency in connection with remittances and payments.[21] Exchanges and brokerages soon found themselves licensed in up to fifty states and territories, alongside gift card issuers and check cashers. These state regimes required licensees to perform important functions, such as know-your-customer and anti-money laundering checks, but did not require licensees to institute market-based protections that are typical under federal market regulatory regimes, such as orderly trading requirements, anti-manipulation rules, and mitigation of conflicts of interest. Nor did these regimes contemplate separate licenses and requirements for brokering, dealing, executing, and clearing trades.
As crypto exploded in popularity, issuers of new crypto assets began to sell their coins directly to the public in what came to be known as "initial coin offerings."[22] Without clear rules of the road, consumers had difficulty discerning the legitimate projects from the fraudulent ones, and trouble distinguishing the Pets.com's from the Amazon's. Like the dot-com bubble before it, the "ICO" bubble eventually burst, and a "crypto winter" set in. But the builders continued to innovate, designing new network layers, protocols, and products. Winter gave way to "crypto spring" and "defi summer," and each cycle a new class of builders entered the fray.
1) What
When the news broke about FTX, it was a slow drip over hours, days, and weeks. A CoinDesk article questioned the company's balance sheet.[23] Another exchange's chief executive publicly expressed skepticism about the company's financials. FTX's founder, Sam Bankman-Fried, followed with the infamous "1) What" tweet.[24] FTX's lenders then struggled to figure out what to do with the "FTT" tokens they held as collateral.[25] Founders and investors frantically called their lawyers and advisors for help. Distressed funds circled the wreckage, picking through FTT and other stranded tokens at collapsed prices as firms raced to salvage whatever value remained. Meanwhile, lawyers and advisors anxiously refreshed their browsers for the latest installment of Matt Levine's daily coverage of the debacle.[26]
Eventually it came to light that FTX's operators stole more than $8 billion in exchange customer assets to engage in their own proprietary investments. Although FTX had a U.S. subsidiary with state money transmitter licenses, its customers' funds were nowhere to be found. However, the customer property held by FTX's CFTC-registered subsidiaries remained segregated and secure. A credit to the agency's robust customer safeguards and market surveillance.
As Professor Perez observed, eventually the euphoria ends, but when it does "the new way of doing things with new technologies has become 'common sense.'"[27] FTX's implosion reverberated throughout the global crypto markets and ushered in a crypto winter unlike any the industry had seen before, but the technology persevered.
This is when the American crypto industry learned "[t]he nine most terrifying words in the English language . . . I'm from the Government, and I'm here to help."[28]
Regulation in One Lesson
Governments across the globe scrambled to respond to FTX's collapse as crypto asset intermediaries across the world continued to fall. In the ensuing months and years, legislators and regulators convened hearings, roundtables, and studies to support the development of new laws and regulations for crypto markets. Dozens of countries then established comprehensive regulatory regimes. The European Union codified MiCA,[29] the United Kingdom issued crypto market rules under FSMA,[30] and Singapore instituted regulations for digital token service providers.[31]
In the United States, the CFTC and Securities and Exchange Commission (SEC) took a different approach. The agencies chose to utilize their existing statutory authorities not to write new rules for these markets, but to regulate them by enforcement.
Before enforcement came to define the federal government's approach to crypto, both agencies spent half a decade attempting to chart a regulatory path for crypto assets.
In 2014, former CFTC Chairman Timothy Massad declared bitcoin to be a "commodity" within the Commission's regulatory scheme.[32] The CFTC later greenlit the first regulated bitcoin futures contracts under the leadership of former Chairman Chris Giancarlo.[33] In the years that followed, former Chairman Heath Tarbert set forth his views as Chairman when he deemed ether to be a "commodity" and, under his leadership, the agency finalized interpretive guidance concerning the term "actual delivery" in relation to crypto assets.[34]
Around this time, the SEC staff followed with a "framework"[35] on investment contracts involving crypto assets and several no-action letters to crypto asset issuers clarifying that their coin offerings would not be subject to registration with the agency.[36] With more than 50 subjective factors to navigate, and no further guidance from the SEC, market participants resorted to creating a dedicated "Crypto Rating Council" to score, on a 1-5 scale, the likelihood of a crypto asset being deemed to be a security.[37] Lawyers started churning out reasoned Howey memos in attempts to untie a Gordian knot of almost a century of case law concerning orange groves, payphones, chinchillas, and condominiums in transactions that bore almost no resemblance to the emergent, decentralized business models that were on the cusp of the new frontier of finance. A boon for lawyers' billable hours - not so much for American innovators.
Then, under the Biden administration, the agencies quickly shifted course to regulation by enforcement - a trend that amplified dramatically in the wake of FTX's downfall. Crypto no-action letters quickly became historical artifacts of a bygone era after regulators closed their doors to productive discussions with market participants.
The CFTC used its authority over "retail commodity transactions" under section 2(c)(2)(D) of the Commodity Exchange Act (CEA) to charge several operators of centralized exchanges and developers of decentralized exchange protocols for offering transactions that are required to be executed on a CFTC-registered exchange, known as a designated contract market (or DCM).[38] The agency proceeded with these investigations and lawsuits despite the lack of clear rules, interpretations, or relief needed to make on-exchange trading of crypto assets possible.
In one case, the CFTC obtained a default judgment against a decentralized autonomous organization after serving process on the protocol by messaging an online "help chat box" on its website.[39] In another, the agency fined a software developer for offering a user interface for an automated market maker protocol that enabled users to interact with smart contracts to engage in off-exchange retail commodity transactions.[40]
The status of a given crypto asset as a "commodity" within the CFTC's remit could only be determined based upon a review of the non-exhaustive list of assets included in each lawsuit and cross-reference against the copious list of "crypto asset securities" included in the SEC's lawsuits.[41] Yet it wasn't even clear that the heads of the two agencies agreed on which assets were and weren't securities.
Under former SEC Chairman Gary Gensler's leadership, the agency similarly charged operators of centralized exchanges and developers of decentralized protocols with failure to register as broker-dealers and national securities exchanges. He glibly directed new entrants to fill out "a form on our website" to register without making any modifications to the SEC's rules or regulations to accommodate the technology.[42]
This may have been a golden age for the Cayman Islands legal bar, which gladly incorporated hundreds of offshore foundation companies for crypto projects, but it was the dark ages for the United States. After the onslaught, few crypto firms remained in the country, each clinging to every word of Commissioner Hester Peirce's dissenting statements to keep the faith.[43]
Hard Fork
After President Trump took office last year, the President's Working Group on Digital Asset Markets quickly instituted a hard fork from these Biden era policies.
SEC Chairman Atkins and I partnered together on Project Crypto to modernize our agencies' rules and regulations to allow our markets to move onchain. As part of this initiative, the CFTC and SEC codified a joint interpretation to put Gary Gensler's "embodiment theory" of security status to bed once and for all.[44] Our joint interpretation classified crypto assets into five general categories: digital commodities,[45] digital collectibles,[46] digital tools,[47] stablecoins,[48] and digital securities.[49] The interpretation clarified that the first three categories are generally not securities, stablecoins may in some cases be structured as securities, and digital securities are, of course, securities. The interpretation also explains how a non-security crypto asset offered or sold as part of an investment contract security may separate from the investment contract and no longer be subject to the federal securities laws.[50]
The SEC subsequently proposed Regulation Crypto Assets to establish a purpose-fit regulatory framework for offerings of investment contracts involving crypto assets and a security status "safe harbor" for crypto assets sold in these offerings.[51] The administration delivered the clarity, certainty, and investor protections that crypto projects and participants demanded for American crypto asset distributions.
A New Path Forward: Regulation CTX and Regulation CAM
Now, I'm disappointed that Congress failed to deliver the Clarity Act to the President's desk. This legislation would have codified in statute the line that Chairman Atkins and I have drawn between securities and non-securities, mandated that centralized crypto asset exchanges and brokerages register with the CFTC, and instituted purpose-fit core principles for these new CFTC registrants. But President Trump promised to deliver a crypto asset regulatory market structure with or without legislation, and we will help him deliver it using our existing statutory authorities.
Today, the CFTC is doing its part to deliver clear rules of the road for crypto asset markets with its advanced notice of proposed rulemaking on Regulation Crypto Asset Transactions (Regulation CTX) and Regulation Crypto Asset Markets (Regulation CAM), which is now live on the CFTC's website. These rules would codify a pathway for crypto asset exchanges to operate under uniform national oversight by the CFTC pursuant to the same statutory authorities that the prior administration instead utilized to regulate by enforcement.
I want to underscore that this is a federal option for crypto asset exchanges. Just like the banking regulatory system, where firms may choose to pursue either a federal or state charter, with each type of charter authorizing the firm to engage in differing types of permissible activities, crypto firms should be free to pursue state licenses or federal registrations based upon the products and services the firm intends to offer. Only Congress has the authority to mandate that all crypto asset exchanges register with the Commission. However, Congress has mandated that exchanges that wish to offer retail customers the ability to trade crypto assets on a margined, leveraged, or financed basis register with the agency. But the agency never used this authority to issue purpose-fit rules for these transactions or platforms, only to enforce.
You might envision a ladder. On the first rung of the ladder are ordinary spot crypto exchanges (Rung 1 Exchanges), which are subject to the CFTC's anti-fraud and anti-manipulation authority but are otherwise generally regulated under state money transmission laws. On the second rung are exchanges that also offer retail customers the ability to trade crypto assets on a margined, leveraged, or financed basis (Rung 2 Exchanges), which are required to register with the CFTC and subject to its exclusive regulation. On the third rung are exchanges that also allow customers to trade perps and all other types of derivatives (Rung 3 Exchanges), which are also required to register with the CFTC and subject to its exclusive jurisdiction.
Today's initial proposals would establish a regulatory framework for Rung 2 Exchanges--or firms offering retail customers the ability to trade crypto assets on a margined, leveraged, or financed basis. We refer to such a transaction as a CTX. Rung 3 Exchanges that are already registered with the CFTC as a DCM could begin offering trading in CTXs on their platforms under tailored rules. Non-registrants that wish to only offer CTXs could choose to either register as an ordinary DCM or pursue registration as a new sub-category of DCM called a "crypto asset market" (or CAM).
This provides firms with a clearer framework for evaluating how to best serve their customers in the United States and helps customers understand what protections apply to the platform they choose.
The CAM regime is designed for exchanges that only offer CTXs. To obtain designation as a CAM, an exchange would be required to adhere to the statutory DCM core principles, but with the benefit of a tailored set of regulations that are purpose-built and designed for CTXs. An exchange offering futures, options, or swaps would remain subject to the current DCM framework.
The statutory DCM core principles give us a sound starting point for the effective regulation of CAMs engaged in creating and administering national markets in CTXs. Principles 3 and 4 address contract listings and market surveillance.[52] Principles 11 and 12 address financial integrity, customer funds, and abusive practices.[53] Principles 16 and 20 address conflicts and system safeguards.[54] For CAMs, the rules promulgated under these statutory obligations would address the specific risks posed by, and commercial realities of, CTXs.
For example, the statutory requirements of DCM Core Principle 3 require a CAM to show that a CTX is not readily susceptible to manipulation.[55] However, the considerations in ensuring compliance with that statutory obligation with respect to CTXs differ from the considerations that are relevant to more traditional CFTC-regulated products. When listing CTXs, DCMs and CAMs may have to consider the distribution method and concentration of crypto assets, lock-ups periods and vesting schedules, whether there are programmatic issuances or buybacks, and a flurry of other crypto asset-specific considerations related to manipulation risks. Many crypto asset exchanges already voluntarily employ purpose-fit procedures to prevent the listing of crypto assets that are readily susceptible to manipulation. The proposed Regulation CAM regime would codify best practices into regulatory obligations that will serve the interests of American markets and their retail participants. Similarly, the Regulation CAM proposal also contemplates a "proof-of-reserves" obligation for exchanges that maintain customer property in omnibus accounts held for their customers' benefit - a safeguard that I am sure would have benefitted FTX's retail customers.
The proposed rules further contemplate the required intermediation of CTXs by a futures commission merchant (or FCM). Those FCMs would manage customer accounts and funds, subject to the CEA's customer protection requirements, including disclosures,[56] capital requirements,[57] and customer property segregation,[58] among other areas. We are also examining and would welcome views on how FCM requirements should fit crypto asset activity while preserving clear responsibility for customer property, records, segregation, risk controls, and supervision. Requiring FCM intermediation of CTXs also ensures that customer-facing activity on a CAM would be subject to the Bank Secrecy Act's (BSA) applicable anti-money laundering, customer identification, and suspicious activity reporting requirements, along with the various other related legal and regulatory obligations that the BSA and Commission regulations impose on FCMs.[59]
For those who prefer to do things the way the cypherpunks originally envisioned, we aim to provide the clarity needed for onchain finance to flourish. Our statute provides an exception to the on-exchange trading requirement for CTXs that involve "actual delivery" of the commodity within 28 days. We propose to codify an interpretation of "actual delivery" to clarify that delivery of a crypto asset to a user's external, non-custodial digital wallet within 28 days generally satisfies this exception.
Onchain Finance
And, another aside on onchain finance. Although outside the scope of today's proposals, we are also exploring a durable policy for developers who publish software but do not solicit or take orders, control execution, or hold customer assets. A person should not have to register as an introducing broker simply because that person shipped code.
We are also working directly with builders to develop lawful pathways for onchain products in the United States. I've directed CFTC staff to engage with developers and founders to understand how onchain venues function, where control resides, how their activities compare to those performed by traditional market intermediaries, and how the CEA and our regulations apply to these new models.
American builders should have a clear path to bring new products to market here, under rules that protect customers and preserve market integrity, without sacrificing the features that make these technologies innovative in the first place.
And that brings me back to the broader purpose of the proposed framework I have outlined today.
Golden Age
As Professor Perez observed, technological revolutions have occurred and followed a similar course throughout human history. From the joint stock company to the railroad to the internet, new technologies are invariably dismissed, then abused by bad actors; there is a frenzy, a bubble, and an inevitable bust; at which point the technology has become common sense and regulators must craft rules for the new frontier. If the regulators get the rules right, they can usher in a golden age.
The framework I have outlined is an important step towards bringing crypto asset markets within the protections of the CEA. It will establish clear rules of the road for firms that want to serve American customers, strengthen the integrity of these markets, and provide a path for responsible innovation to take place here in America.
For years, entrepreneurs building on the new frontier of finance faced uncertainty about whether there was a place for them in our markets. We are giving them an answer.
Build here. Build markets that are open, competitive, and worthy of the public's trust. Build under American rules and American standards. And build knowing that responsible innovation has a place in the United States.
Satoshi's technological revolution has transformed global financial markets. If America can embrace this paradigm shift and get the right regulations in place, we can usher in a golden age like those that followed the transformative technologies of the past.[60]
Thank you, and I look forward to the fireside chat to follow.
* * *
[1] Virtual Currencies: The Oversight Role of the U.S. Securities and Exchange Commission and the U.S. Commodity Futures Trading Commission: Hearing Before the S. Comm. on Banking, Hous., & Urb. Affs., 115th Congress 6 (2018) (statement of J. Christopher Giancarlo, Chairman, CFTC).
[2] Carlota Perez, Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages 4-5 (2002).
[3] Satoshi Nakamoto, Bitcoin: A Peer-to-Peer Electronic Cash System (Oct. 31, 2008), available at https://bitcoin.org/bitcoin.pdf.
[4] Id.
[5] See Satoshi Nakamoto, Bitcoin P2P e-cash paper, Cryptography Mailing List, available at https://satoshi.nakamotoinstitute.org/emails/cryptography/1/ (Oct. 31, 2006).
[6] See Vitalik Buterin, Medium.com/@VitalikButerin, The Meaning of Decentralization (Feb. 8, 2017), available at https://medium.com/@VitalikButerin/the-meaning-of-decentralization-a0c92b76a274.
[7] Nakamoto explained that "[i]t might make sense just to get some in case it catches on. If enough people think the same way, that becomes a self-fulfilling prophecy." Satoshi Nakamoto, Cryptography Mailing List, Subject: Bitcoin v0.1 released (Jan. 17, 2009), available at https://satoshi.nakamotoinstitute.org/emails/cryptography/16/.
[8] See Vitalik Buterin, Ethereum: A Next-Generation Smart Contract and Decentralized Application Platform (Dec. 2014), available at https://ethereum.org/whitepaper/.
[9] "Using a calculator is a trustless activity, whereas investing in a guy named Bernie is not." Omid Malekan, Re-Architecting Trust: The Curse of History and the Crypto Cure for Money, Markets, and Platforms xiv (2022).
[10] See Nick Szabo, The dawn of trustworthy computing (Dec. 11, 2014), available at https://unenumerated.blogspot.com/2014/12/the-dawn-of-trustworthy-computing.html ("A block chain computer is a virtual computer, a computer in the cloud, shared across many traditional computers and protected by cryptography and consensus technology.").
[11] Vitalik Buterin, Bitcoin Magazine, Ethereum: A Next-Generation Cryptocurrency and Decentralized Application Platform (Jan. 23, 2014), available at https://bitcoinmagazine.com/business/ethereum-next-generation-cryptocurrency-decentralized-application-platform-1390528211.
[12] Naval Ravikant, @naval, X (June 21, 2017), available at https://x.com/naval/status/877467629308395521.
[13] Marc Andreessen & Katie Haun, From the Internet's Past to the Future of Crypto, The a16z Podcast (Aug. 29, 2019), available at https://a16z.com/podcast/a16z-podcast-from-the-internets-past-to-the-future-of-crypto/.
[14] Hernando de Soto, The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else (Basic Books 2000); see also David Hoffman, Ryan Sean Adams & Hernando de Soto, The Power of Property Rights with Hernando de Soto, Bankless (Nov. 30, 2023), available at https://www.bankless.com/a-property-rights-masterclass-with-hernando-de-soto ("This is a race to title the world [between the U.S. and China] . . . and if [the U.S.] partner[s] with blockchain, if [it] adopt[s] blockchain technologies, the win for the U.S. is that it can outcompete China to help title the world.").
[15] "The read era of the internet was defined by the website, which encapsulated information. The read-write era was defined by the post, which encapsulated publishing, making it easy for anyone, not just web developers, to reach broad audiences. The internet's latest phase--the read-write-own era--is defined by a new simplifying concept: tokens, which encapsulate ownership." Chris Dixon, Read Write Own, at 74 (2024).
[16] See id. at xiv.
[17] Chris Dixon distinguishes between "protocol networks," which are permissionless, "open systems controlled by communities of software developers and other network stakeholders" and "corporate networks," which are permissioned, owned and controlled by companies. See id. at xxi. See also Malekan, supra note 9 ("What is good for the owners inevitably comes at the expense of users, with management perpetually stuck in between.").
[18] Fred Ehrsam, Blockchain Governance: Programming Our Future (Nov. 27, 2017), available at https://www.fehrsam.xyz/blog/blockchain-governance-programming-our-future.
[19] Derek Edward Schloss, Storing Value in Digital Objects (Feb. 6, 2023), available at https://medium.com/collab-currency/storing-value-in-digital-objects-a92f54fa98cc.
[20] See, e.g., Robert McMillan, The Inside Story of Mt. Gox, Bitcoin's $460 Million Disaster, WIRED (Mar. 3, 2014), available at https://www.wired.com/2014/03/bitcoin-exchange/.
[21] See Congressional Research Service, Telegraphs, Steamships, and Virtual Currency: An Analysis of Money Transmitter Regulation, at 1 (Aug. 20, 2020), available at https://www.congress.gov/crs_external_products/R/PDF/R46486/R46486.2.pdf.
[22] Mike Orcutt, Despite shadiness and crackdowns, the ICO boom is bigger than ever, MIT Technology Review (July 3, 2018), available at https://www.technologyreview.com/2018/07/03/2534/despite-shadiness-and-crackdowns-the-ico-boom-is-bigger-than-ever/.
[23] Ian Allison, Divisions in Sam Bankman-Fried's Crypto Empire Blur on His Trading Titan Alameda's Balance Sheet, CoinDesk (Aug. 16, 2023), available at https://www.coindesk.com/business/2022/11/02/divisions-in-sam-bankman-frieds-crypto-empire-blur-on-his-trading-titan-alamedas-balance-sheet.
[24] @SBF_FTX, X (Nov. 13, 2022), available at https://x.com/SBF_FTX/status/1591989554881658880.
[25] See Complaint
69-74, SEC v. Ellison, No. 22-cv-10794 (S.D.N.Y. Dec. 21, 2022).
[26] See, e.g., Matt Levine, FTX Had Many Bad Spreadsheets, Bloomberg (Oct. 12, 2023), available at https://www.bloomberg.com/opinion/articles/2023-10-12/ftx-had-many-bad-spreadsheets.
[27] See Perez, supra note 2.
[28] Ronald Reagan Presidential Foundation & Institute, Reagan on Government (Aug. 12, 1986), available at https://www.reaganfoundation.org/ronald-reagan/quotes/the-nine-most-terrifying-words-in-the-english-language.
[29] Regulation (EU) 2023/1114 of the European Parliament and of the Council of 31 May 2023 on Markets in Crypto-Assets (MiCA), 2023 O.J. (L 150) 40, available at https://eur-lex.europa.eu/eli/reg/2023/1114/oj.
[30] Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026, SI 2026/102 (U.K.), available at https://www.legislation.gov.uk/uksi/2026/102; Financial Conduct Authority, PS26/11. Regulated Cryptoasset Activities (June 30, 2026), available at https://www.fca.org.uk/firms/new-regime-cryptoasset-regulation.
[31] Financial Services and Markets Act 2022, pt. 9 (Sing.), available at https://sso.agc.gov.sg/Act/FSMA2022; Financial Services and Markets (Digital Token Service Providers) Regulations 2025 (Sing.); see also Monetary Authority of Singapore, MAS Clarifies Regulatory Regime for Digital Token Service Providers (June 6, 2025), available at https://www.mas.gov.sg/news/media-releases/2025/mas-clarifies-regulatory-regime-for-digital-token-service-providers.
[32] CFTC Chairman Timothy Massad, Testimony Before the U.S. Senate Committee on Agriculture, Nutrition & Forestry (Dec. 10, 2014), available at https://www.cftc.gov/PressRoom/SpeechesTestimony/opamassad-6.
[33] CFTC, CFTC Statement on Self-Certification of Bitcoin Products by CME, CFE and Cantor Exchange, Release No. 7654-17 (Dec. 1, 2017) (quoting former Chairman J. Christopher Giancarlo), available at https://www.cftc.gov/PressRoom/PressReleases/7654-17.
[34] See Retail Commodity Transactions Involving Certain Digital Assets, 85 FR 37734 (June 24, 2020) (later withdrawn).
[35] SEC, Div. of Corp. Fin., Framework for "Investment Contract" Analysis of Digital Assets (Apr. 3, 2019), available at https://www.sec.gov/files/dlt-framework.pdf (later withdrawn).
[36] See, e.g., SEC, Div. of Corp. Fin., Response of the Division of Corporation Finance Re: Pocketful of Quarters, Inc. (July 25, 2019), available at https://www.sec.gov/corpfin/pocketful-quarters-inc-072519-2a1; SEC, Div. of Corp. Fin., Response of the Division of Corporation Finance Re: IMVU, Inc. (Nov. 19, 2020), available at https://www.sec.gov/rules regulations/no-action-interpretive-exemptive-letters/division-corporation-finance-no-action/imvu-111920-2a1.
[37] Coinbase, Introducing the Crypto Rating Council (Sep. 30, 2019), available at https://www.coinbase.com/blog/introducing-the-crypto-rating-council ("Although the [SEC] has issued helpful guidance, whether any given crypto asset is a security ultimately requires a fact-intensive analysis by knowledgeable technical and securities law experts. This analysis is difficult and expensive to operationalize consistently, may involve judgment calls, and can lead to disagreement among legal experts (and even government officials). This challenge prompted Coinbase to bring together several industry leaders and securities law experts to create a scalable, points-based rating system centered around a set of several dozen, yes / no factual questions. These questions are derived directly from SEC guidance and case law and are designed to address important characteristics that inform whether an asset is or is not a security.").
[38] See, e.g., In re Payward Ventures, Inc. (d/b/a Kraken), CFTC No. 21-20 (Sept. 28, 2021); CFTC, CFTC Issues Orders Against Operators of Three DeFi Protocols for Offering Illegal Digital Asset Derivatives Trading, Release No. 8774-23 (Sept. 7, 2023), available at https://www.cftc.gov/PressRoom/PressReleases/8774-23; CFTC, CFTC Issues Order Against Uniswap Labs for Offering Illegal Digital Asset Derivatives Trading, Release No. 8961-24 (Sept. 4, 2024), available at https://www.cftc.gov/PressRoom/PressReleases/8961-24.
[39] See Proskauer, From Code to Consequence: CFTC Obtains Default Judgment Against Ooki DAO for Commodity Exchange Act Violations, Blockchain and the Law (July 20, 2023), available at https://www.proskauer.com/blog/from-code-to-consequence-cftc-obtains-default-judgment-against-ooki-dao-for-commodity-exchange-act-violations.
[40] See CFTC Issues Order Against Uniswap Labs for Offering Illegal Digital Asset Derivatives Trading, Release No. 8961-24 (Sep. 4, 2024), available at https://www.cftc.gov/PressRoom/PressReleases/8961-24.
[41] See Gary Gensler, "Partners of Honest Business and Prosecutors of Dishonesty": Remarks by Chair Gensler Before the 2023 Securities Enforcement Forum (Oct. 26, 2023), available at https://www.sec.gov/newsroom/speeches-statements/gensler-remarks-securities-enforcement-forum-102523. (". . . crypto intermediaries--transacting in these crypto asset securities--are subject to the securities laws as well.").
[42] See First on CNBC: CNBC Transcript: SEC Chair Gary Gensler Speaks with CNBC's "Squawk Box" Today, CNBC (Feb. 10, 2023), available at https://www.cnbc.com/2023/02/10/first-on-cnbc-cnbc-transcript-sec-chair-gary-gensler-speaks-with-cnbcs-squawk-box-today.html.
[43] Commissioner Peirce dissented to more than 15 SEC actions and authored more than 10 critical speeches related to crypto issues during these years.
[44] See Application of the Federal Securities Laws to Certain Types of Crypto Assets and Certain Transactions Involving Crypto Assets, 91 FR 13714, 13715 n. 1 (Mar. 23, 2026) ("Joint Crypto Asset Taxonomy").
[45] Id., at 13718, providing that a digital commodity is a crypto asset that is intrinsically linked to and derives its value from the programmatic operation of a crypto system that is functional, as well as supply and demand dynamics, rather than from the expectation of profits from the essential managerial efforts of others. In the Joint Crypto Asset Taxonomy, the Commissions provided their views as to examples of digital commodities, which include, among others, Bitcoin (BTC); Ether (ETH); Solana (SOL); Stellar (XLM); Tezos (XTZ); and XRP (XRP).
[46] See id. at 13718, providing that a digital collectible is a crypto asset that is designed to be collected and/or used and may represent or convey rights to artwork, music, videos, trading cards, in-game items, or digital representations or references to internet memes, characters, current events, or trends, among other things. A digital collectible does not have intrinsic economic properties or rights, such as generating a passive yield or conveying rights to future income, profits, or assets of a business enterprise or other entity, promisor, or obligor.
[47] See id. at 13719, providing that a digital tool is a crypto asset that performs a practical function, such as a membership, ticket, credential, title instrument, or identity badge. Digital tools are commonly issued for use in connection with crypto systems and are designed to perform practical functions within such systems. Digital tools often are non-transferrable or "soul-bound," and their value is derived from their practical functionality.
[48] See id. at 13720, providing that a stablecoin is a crypto asset that is designed to maintain a stable value relative to a reference asset like the U.S. dollar.
[49] See id. at 13720, providing that a digital security (commonly known as a "tokenized" security) is a financial instrument enumerated in the definition "security" that is formatted as or represented by a crypto asset, where the record of ownership is maintained in whole or in part on or through one or more crypto networks.
[50] Id. at 13722-3. The Joint Crypto Asset Taxonomy set forth the Commissions' view that a non-security crypto asset would no longer be subject to an investment contract when: (1) the issuer has fulfilled its representations or promises to engage in essential managerial efforts, or (2) the purchaser would not reasonably expect the issuer to be able to fulfill or to continue to engage in the essential managerial efforts it represented or promised it would undertake.
[51] SEC, Regulation Crypto Assets, 91 FR 54510 (proposed Aug. 21, 2026).
[52] CEA 5(d)(3), 7 U.S.C. 7(d)(3); CEA 5(d)(3), 7 U.S.C. 7(d)(4).
[53] CEA 5(d)(11), 7 U.S.C. 7(d)(11); CEA 5(d)(12), 7 U.S.C. 7(d)(12).
[54] CEA 5(d)(16), 7 U.S.C. 7(d)(16); CEA 5(d)(20), 7 U.S.C. 7(d)(20).
[55] CEA 5(d)(3), 7 U.S.C. 7(d)(3).
[56] 17 CFR 1.55.
[57] CEA 4f(b), 7 U.S.C. 6f(b).
[58] CEA 4d(a)(2), 7 U.S.C. 6d(a)(2).
[59] See, e.g., 17 CFR 42.2. The legal and regulatory obligations under the BSA applicable to FCMs support the detection and prevention of money laundering and other illicit financial activity, facilitate regulatory oversight of such FCMs' compliance controls, and require the provision of relevant information to law enforcement authorities.
[60] In other words, "[i]f your idea of money is what it was yesterday, you will lose it to the people who know what money will be tomorrow." Naval Ravikant, @naval, X (Sep. 23, 2021), available at https://x.com/naval/status/1440954808052039684.
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Original text here: https://www.cftc.gov/PressRoom/SpeechesTestimony/opaselig12
SEC Coordinates with Global Financial Regulators to Raise Fraud Awareness During World Investor Week
WASHINGTON, Oct. 5 -- The Securities and Exchange Commission issued the following news release:
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SEC Coordinates with Global Financial Regulators to Raise Fraud Awareness During World Investor Week
*
The Securities and Exchange Commission, in coordination with other U.S. and global financial regulators, today issued a joint investor bulletin as part of World Investor Week (WIW). The bulletin encourages investors to be resilient in changing economic conditions and to be vigilant in the face of rising relationship investment and impersonation scams.
World Investor Week is a global effort ... Show Full Article WASHINGTON, Oct. 5 -- The Securities and Exchange Commission issued the following news release: * * * SEC Coordinates with Global Financial Regulators to Raise Fraud Awareness During World Investor Week * The Securities and Exchange Commission, in coordination with other U.S. and global financial regulators, today issued a joint investor bulletin as part of World Investor Week (WIW). The bulletin encourages investors to be resilient in changing economic conditions and to be vigilant in the face of rising relationship investment and impersonation scams. World Investor Week is a global effortby the International Organization of Securities Commissions to bring together regulators across six continents to raise awareness about the importance of investor education and investor protection. This year marks WIW's tenth anniversary. The SEC, coordinating U.S. efforts, worked with the Commodity Futures Trading Commission, Financial Industry Regulatory Authority, Securities Investor Protection Corporation, National Futures Association, and North American Securities Administrators Association to issue the joint Investor Bulletin.
"Investor protection is a core tenet of the SEC's mission, and World Investor Week provides another important opportunity for U.S. financial regulators and international counterparts to raise awareness together and encourage investor resilience across the globe," said SEC Chairman Paul S. Atkins. "This week, as always, I urge investors to take advantage of the resources on the SEC's Investor.gov website and to remain vigilant against potential scams."
"Investors can use the principles of resiliency that the SEC and our partners highlight this week to help protect themselves against fraud and weather market volatility," said John Moses, Director of the SEC's Office of Investor Education and Assistance. "We encourage investors to visit Investor.gov, which provides free, accurate, unbiased information and financial planning tools to help individuals invest wisely and better protect themselves against investment fraud."
The SEC's WIW page highlights resources on investor education and protection.
***
Original text here: https://www.sec.gov/newsroom/press-releases/2026-101-sec-coordinates-global-financial-regulators-raise-fraud-awareness-during-world-investor-week
* * *
SEC Coordinates with Global Financial Regulators to Raise Fraud Awareness During World Investor Week
*
The Securities and Exchange Commission, in coordination with other U.S. and global financial regulators, today issued a joint investor bulletin as part of World Investor Week (WIW). The bulletin encourages investors to be resilient in changing economic conditions and to be vigilant in the face of rising relationship investment and impersonation scams.
World Investor Week is a global effort ... Show Full Article WASHINGTON, Oct. 5 -- The Securities and Exchange Commission issued the following news release: * * * SEC Coordinates with Global Financial Regulators to Raise Fraud Awareness During World Investor Week * The Securities and Exchange Commission, in coordination with other U.S. and global financial regulators, today issued a joint investor bulletin as part of World Investor Week (WIW). The bulletin encourages investors to be resilient in changing economic conditions and to be vigilant in the face of rising relationship investment and impersonation scams. World Investor Week is a global effortby the International Organization of Securities Commissions to bring together regulators across six continents to raise awareness about the importance of investor education and investor protection. This year marks WIW's tenth anniversary. The SEC, coordinating U.S. efforts, worked with the Commodity Futures Trading Commission, Financial Industry Regulatory Authority, Securities Investor Protection Corporation, National Futures Association, and North American Securities Administrators Association to issue the joint Investor Bulletin.
"Investor protection is a core tenet of the SEC's mission, and World Investor Week provides another important opportunity for U.S. financial regulators and international counterparts to raise awareness together and encourage investor resilience across the globe," said SEC Chairman Paul S. Atkins. "This week, as always, I urge investors to take advantage of the resources on the SEC's Investor.gov website and to remain vigilant against potential scams."
"Investors can use the principles of resiliency that the SEC and our partners highlight this week to help protect themselves against fraud and weather market volatility," said John Moses, Director of the SEC's Office of Investor Education and Assistance. "We encourage investors to visit Investor.gov, which provides free, accurate, unbiased information and financial planning tools to help individuals invest wisely and better protect themselves against investment fraud."
The SEC's WIW page highlights resources on investor education and protection.
***
Original text here: https://www.sec.gov/newsroom/press-releases/2026-101-sec-coordinates-global-financial-regulators-raise-fraud-awareness-during-world-investor-week
Premier Martial Arts Franchisor and its Former Franchise Sales Organization Settle FTC Charges that the Companies Made Deceptive Claims and Violated the Franchise Rule
WASHINGTON, Oct. 5 -- The Federal Trade Commission issued the following news release:
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Premier Martial Arts Franchisor and its Former Franchise Sales Organization Settle FTC Charges that the Companies Made Deceptive Claims and Violated the Franchise Rule
*
Franchisor Premier Franchising Group LLC (PFG) and its former franchise sales organization, Franchise Fastlane LLC (FFL), will pay $1.85 million to settle Federal Trade Commission allegations that they made misleading representations about the Premier Martial Arts (PMA) franchise opportunity and violated the Franchise Rule.
Under the ... Show Full Article WASHINGTON, Oct. 5 -- The Federal Trade Commission issued the following news release: * * * Premier Martial Arts Franchisor and its Former Franchise Sales Organization Settle FTC Charges that the Companies Made Deceptive Claims and Violated the Franchise Rule * Franchisor Premier Franchising Group LLC (PFG) and its former franchise sales organization, Franchise Fastlane LLC (FFL), will pay $1.85 million to settle Federal Trade Commission allegations that they made misleading representations about the Premier Martial Arts (PMA) franchise opportunity and violated the Franchise Rule. Under theproposed settlement with PFG, certain franchisees will be given the option to cancel their franchise agreements without penalty.
"Franchisors are legally required to be upfront and honest about earnings potential and the associated risks before franchisees pour their hard-earned money into a franchise opportunity," said Christopher Mufarrige, Director of the FTC's Bureau of Consumer Protection. "The FTC will continue to take action to protect small businesses and franchisees and hold those that break the law accountable."
According to the FTC's complaint, PFG and FFL made deceptive and unsubstantiated claims while promoting the PMA opportunity. For instance, the companies deceptively claimed that non-martial artists could profitably operate one or multiple PMA martial arts franchises on a semi-absentee basis working less than 15 hours a week. These deceptive claims, among others, enticed more than 200 consumers to pay PFG an initial franchise fee of $49,500 or more to purchase a PMA franchise opportunity. As a result, these consumers, which included veterans, incurred hundreds of thousands of dollars in additional expenses to build out and operate their studios, with many assuming significant debt.
The complaint further alleges that PFG also deceived prospective franchisees by making deceptive earnings claims in its 2020-2022 Franchise Disclosure Documents (FDDs). The complaint alleges that PFG reported in its FDDs that its existing PMA franchisee studios earned significant income but lacked a reasonable basis to know whether those studio earnings were representative of what new PMA franchisee studios could earn, because, at the time, PMA's existing franchisees operated studios that were materially different than the studios prospective franchisees would operate. For example, many existing franchisees had larger studios than what PFG recommended that new franchisees open (2,000-7,000 square feet versus 1,200-1,600 square feet). Also, most new franchisees had no martial arts experience, and existing franchisees had significant martial arts experience.
In addition, the complaint alleges that PFG failed to disclose those differences and that FFL personnel had management roles in the marketing and selling of the PMA franchise, as legally required under the Franchise Rule. The complaint also notes that PFG and FFL violated the Franchise Rule by making financial performance representations that were not contained in the FDDs.
The proposed order against PFG imposes a $3,875,424 monetary judgment against PFG, which will be partially suspended upon payment of $650,000. The proposed order against FFL requires it to pay $1.2 million. The money paid by PFG and FFL will be used to compensate franchisees. In addition, the proposed orders against PFG and FFL:
* Prohibit misrepresentations that are at issue in this case, as well as misrepresenting any other fact material to consumers
* Require compliance with the Franchise Rule
The proposed order with PFG also requires it to send a notice to certain franchisees offering them the right to cancel their existing franchise agreements, with no penalty to the franchisee.
The Commission vote approving the filing of the complaint and the proposed orders was 2-0. The FTC filed the complaint and proposed orders in the U.S. District Court for the Eastern District of Tennessee.
NOTE: Stipulated final orders have the force of law when approved and signed by the District Court judge.
***
Original text here: https://www.ftc.gov/news-events/news/press-releases/2026/10/premier-martial-arts-franchisor-its-former-franchise-sales-organization-settle-ftc-charges-companies
* * *
Premier Martial Arts Franchisor and its Former Franchise Sales Organization Settle FTC Charges that the Companies Made Deceptive Claims and Violated the Franchise Rule
*
Franchisor Premier Franchising Group LLC (PFG) and its former franchise sales organization, Franchise Fastlane LLC (FFL), will pay $1.85 million to settle Federal Trade Commission allegations that they made misleading representations about the Premier Martial Arts (PMA) franchise opportunity and violated the Franchise Rule.
Under the ... Show Full Article WASHINGTON, Oct. 5 -- The Federal Trade Commission issued the following news release: * * * Premier Martial Arts Franchisor and its Former Franchise Sales Organization Settle FTC Charges that the Companies Made Deceptive Claims and Violated the Franchise Rule * Franchisor Premier Franchising Group LLC (PFG) and its former franchise sales organization, Franchise Fastlane LLC (FFL), will pay $1.85 million to settle Federal Trade Commission allegations that they made misleading representations about the Premier Martial Arts (PMA) franchise opportunity and violated the Franchise Rule. Under theproposed settlement with PFG, certain franchisees will be given the option to cancel their franchise agreements without penalty.
"Franchisors are legally required to be upfront and honest about earnings potential and the associated risks before franchisees pour their hard-earned money into a franchise opportunity," said Christopher Mufarrige, Director of the FTC's Bureau of Consumer Protection. "The FTC will continue to take action to protect small businesses and franchisees and hold those that break the law accountable."
According to the FTC's complaint, PFG and FFL made deceptive and unsubstantiated claims while promoting the PMA opportunity. For instance, the companies deceptively claimed that non-martial artists could profitably operate one or multiple PMA martial arts franchises on a semi-absentee basis working less than 15 hours a week. These deceptive claims, among others, enticed more than 200 consumers to pay PFG an initial franchise fee of $49,500 or more to purchase a PMA franchise opportunity. As a result, these consumers, which included veterans, incurred hundreds of thousands of dollars in additional expenses to build out and operate their studios, with many assuming significant debt.
The complaint further alleges that PFG also deceived prospective franchisees by making deceptive earnings claims in its 2020-2022 Franchise Disclosure Documents (FDDs). The complaint alleges that PFG reported in its FDDs that its existing PMA franchisee studios earned significant income but lacked a reasonable basis to know whether those studio earnings were representative of what new PMA franchisee studios could earn, because, at the time, PMA's existing franchisees operated studios that were materially different than the studios prospective franchisees would operate. For example, many existing franchisees had larger studios than what PFG recommended that new franchisees open (2,000-7,000 square feet versus 1,200-1,600 square feet). Also, most new franchisees had no martial arts experience, and existing franchisees had significant martial arts experience.
In addition, the complaint alleges that PFG failed to disclose those differences and that FFL personnel had management roles in the marketing and selling of the PMA franchise, as legally required under the Franchise Rule. The complaint also notes that PFG and FFL violated the Franchise Rule by making financial performance representations that were not contained in the FDDs.
The proposed order against PFG imposes a $3,875,424 monetary judgment against PFG, which will be partially suspended upon payment of $650,000. The proposed order against FFL requires it to pay $1.2 million. The money paid by PFG and FFL will be used to compensate franchisees. In addition, the proposed orders against PFG and FFL:
* Prohibit misrepresentations that are at issue in this case, as well as misrepresenting any other fact material to consumers
* Require compliance with the Franchise Rule
The proposed order with PFG also requires it to send a notice to certain franchisees offering them the right to cancel their existing franchise agreements, with no penalty to the franchisee.
The Commission vote approving the filing of the complaint and the proposed orders was 2-0. The FTC filed the complaint and proposed orders in the U.S. District Court for the Eastern District of Tennessee.
NOTE: Stipulated final orders have the force of law when approved and signed by the District Court judge.
***
Original text here: https://www.ftc.gov/news-events/news/press-releases/2026/10/premier-martial-arts-franchisor-its-former-franchise-sales-organization-settle-ftc-charges-companies
FTC Issues Letters Warning Hospitals Against Deceptive Pricing Practices
WASHINGTON, Oct. 5 -- The Federal Trade Commission issued the following news release:
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FTC Issues Letters Warning Hospitals Against Deceptive Pricing Practices
*
Federal Trade Commission Chairman Andrew N. Ferguson today sent letters to 24 of the nation's largest healthcare services companies, reminding them of their legal obligation to provide patients with timely, accurate and complete pricing information for healthcare services, and that failing to do so can be an unfair or deceptive practice.
The letters sent today are part of the Trump FTC's ongoing commitment to promote healthcare ... Show Full Article WASHINGTON, Oct. 5 -- The Federal Trade Commission issued the following news release: * * * FTC Issues Letters Warning Hospitals Against Deceptive Pricing Practices * Federal Trade Commission Chairman Andrew N. Ferguson today sent letters to 24 of the nation's largest healthcare services companies, reminding them of their legal obligation to provide patients with timely, accurate and complete pricing information for healthcare services, and that failing to do so can be an unfair or deceptive practice. The letters sent today are part of the Trump FTC's ongoing commitment to promote healthcareaffordability and price transparency for consumers.
The letters highlight concerns that healthcare services companies may violate the FTC Act by failing to provide transparent price information, particularly for routine and non-emergency medical care scheduled in advance.
Healthcare is among the largest and most consequential expenses American families face, yet patients are routinely asked to commit to care without knowing what it will cost and with prices for the same service often differing dramatically from one facility to the next. When patients are not told the true price in advance, the letters explain, both consumers and competition suffer. This also means patients cannot comparison shop or make informed decisions, and providers that deal honestly and transparently are put at a competitive disadvantage.
The letters emphasize that the Centers for Medicare & Medicaid Services' price transparency rules establish a critical baseline for ensuring that healthcare facilities provide pricing information. However, compliance with these CMS requirements does not mean that a healthcare facility has met its obligations under Section 5 of the FTC Act. The CMS rules do not create a safe harbor from FTC Act liability.
Because price is a material term, the letters state, clear and conspicuous disclosures are often needed. Failing to disclose the price of a healthcare service may be deceptive if the omission is likely to mislead consumers acting reasonably under the circumstances. And when a disclosure is made, it may still be deceptive if it is incomplete, such as when it omits physician or facility fees or covers only a portion of the expected course of care. This is so because patients may reasonably believe they have been told the total cost of their care. Inaccurate disclosures are likewise misleading.
Failure to provide transparent pricing may also be unfair under Section 5 if it causes or is likely to cause substantial injury that consumers cannot reasonably avoid and that is not outweighed by countervailing benefits to consumers or competition. For example, when price information is incomplete, inaccurate or not provided sufficiently in advance for scheduled services, consumers cannot compare competing healthcare providers' services or make informed decisions. Nor do incomplete, inaccurate or untimely pricing disclosures (where that information is reasonably available to the healthcare provider in advance) provide any countervailing benefits to competition or consumers. On the contrary, this practice undermines competition by obscuring one of the most important dynamics of competition from consumer observation and comparison.
Chairman Ferguson urged the healthcare services companies to conduct a comprehensive review of their price disclosure practices and take swift corrective action as needed.
The FTC has prioritized investigating and prosecuting deceptive and unfair practices in the healthcare industry, including through Chairman Ferguson's creation of the Healthcare Task Force earlier this year. Last week, the FTC sued online contact lens providers Lens.com for misrepresenting the price of contact lenses in search ads and on its website.
***
Original text here: https://www.ftc.gov/news-events/news/press-releases/2026/10/ftc-issues-letters-warning-hospitals-against-deceptive-pricing-practices
* * *
FTC Issues Letters Warning Hospitals Against Deceptive Pricing Practices
*
Federal Trade Commission Chairman Andrew N. Ferguson today sent letters to 24 of the nation's largest healthcare services companies, reminding them of their legal obligation to provide patients with timely, accurate and complete pricing information for healthcare services, and that failing to do so can be an unfair or deceptive practice.
The letters sent today are part of the Trump FTC's ongoing commitment to promote healthcare ... Show Full Article WASHINGTON, Oct. 5 -- The Federal Trade Commission issued the following news release: * * * FTC Issues Letters Warning Hospitals Against Deceptive Pricing Practices * Federal Trade Commission Chairman Andrew N. Ferguson today sent letters to 24 of the nation's largest healthcare services companies, reminding them of their legal obligation to provide patients with timely, accurate and complete pricing information for healthcare services, and that failing to do so can be an unfair or deceptive practice. The letters sent today are part of the Trump FTC's ongoing commitment to promote healthcareaffordability and price transparency for consumers.
The letters highlight concerns that healthcare services companies may violate the FTC Act by failing to provide transparent price information, particularly for routine and non-emergency medical care scheduled in advance.
Healthcare is among the largest and most consequential expenses American families face, yet patients are routinely asked to commit to care without knowing what it will cost and with prices for the same service often differing dramatically from one facility to the next. When patients are not told the true price in advance, the letters explain, both consumers and competition suffer. This also means patients cannot comparison shop or make informed decisions, and providers that deal honestly and transparently are put at a competitive disadvantage.
The letters emphasize that the Centers for Medicare & Medicaid Services' price transparency rules establish a critical baseline for ensuring that healthcare facilities provide pricing information. However, compliance with these CMS requirements does not mean that a healthcare facility has met its obligations under Section 5 of the FTC Act. The CMS rules do not create a safe harbor from FTC Act liability.
Because price is a material term, the letters state, clear and conspicuous disclosures are often needed. Failing to disclose the price of a healthcare service may be deceptive if the omission is likely to mislead consumers acting reasonably under the circumstances. And when a disclosure is made, it may still be deceptive if it is incomplete, such as when it omits physician or facility fees or covers only a portion of the expected course of care. This is so because patients may reasonably believe they have been told the total cost of their care. Inaccurate disclosures are likewise misleading.
Failure to provide transparent pricing may also be unfair under Section 5 if it causes or is likely to cause substantial injury that consumers cannot reasonably avoid and that is not outweighed by countervailing benefits to consumers or competition. For example, when price information is incomplete, inaccurate or not provided sufficiently in advance for scheduled services, consumers cannot compare competing healthcare providers' services or make informed decisions. Nor do incomplete, inaccurate or untimely pricing disclosures (where that information is reasonably available to the healthcare provider in advance) provide any countervailing benefits to competition or consumers. On the contrary, this practice undermines competition by obscuring one of the most important dynamics of competition from consumer observation and comparison.
Chairman Ferguson urged the healthcare services companies to conduct a comprehensive review of their price disclosure practices and take swift corrective action as needed.
The FTC has prioritized investigating and prosecuting deceptive and unfair practices in the healthcare industry, including through Chairman Ferguson's creation of the Healthcare Task Force earlier this year. Last week, the FTC sued online contact lens providers Lens.com for misrepresenting the price of contact lenses in search ads and on its website.
***
Original text here: https://www.ftc.gov/news-events/news/press-releases/2026/10/ftc-issues-letters-warning-hospitals-against-deceptive-pricing-practices
FDIC Issues List of Banks Examined for CRA Compliance
WASHINGTON, Oct. 5 -- The Federal Deposit Insurance Corporation issued the following news release:
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FDIC Issues List of Banks Examined for CRA Compliance
*
WASHINGTON--The Federal Deposit Insurance Corporation (FDIC) today issued its list of state nonmember banks recently evaluated for compliance with the Community Reinvestment Act (CRA). The list covers evaluation ratings that the FDIC assigned to institutions in July 2026.
The CRA is a 1977 law that requires the FDIC to assess a bank's record of meeting the credit needs of its entire community, including those of low- and moderate-income ... Show Full Article WASHINGTON, Oct. 5 -- The Federal Deposit Insurance Corporation issued the following news release: * * * FDIC Issues List of Banks Examined for CRA Compliance * WASHINGTON--The Federal Deposit Insurance Corporation (FDIC) today issued its list of state nonmember banks recently evaluated for compliance with the Community Reinvestment Act (CRA). The list covers evaluation ratings that the FDIC assigned to institutions in July 2026. The CRA is a 1977 law that requires the FDIC to assess a bank's record of meeting the credit needs of its entire community, including those of low- and moderate-incomeneighborhoods, consistent with safe and sound operations. As part of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA), Congress mandated the public disclosure of an evaluation and rating for each bank or thrift that undergoes a CRA examination on or after July 1, 1990.
You may obtain a consolidated list of all state nonmember banks whose evaluations have been made publicly available since July 1, 1990, including the rating for each bank, or obtain a hard copy from FDIC's Public Information Center, 3501 Fairfax Drive, Room E-1002, Arlington, VA 22226 (877-275-3342 or 703-562-2200).
A copy of an individual bank's CRA evaluation is available directly from the bank, which is required by law to make the material available upon request, or from the FDIC's Public Information Center.
***
Original text here: https://www.fdic.gov/news/press-releases/2026/fdic-issues-list-banks-examined-cra-compliance-8
* * *
FDIC Issues List of Banks Examined for CRA Compliance
*
WASHINGTON--The Federal Deposit Insurance Corporation (FDIC) today issued its list of state nonmember banks recently evaluated for compliance with the Community Reinvestment Act (CRA). The list covers evaluation ratings that the FDIC assigned to institutions in July 2026.
The CRA is a 1977 law that requires the FDIC to assess a bank's record of meeting the credit needs of its entire community, including those of low- and moderate-income ... Show Full Article WASHINGTON, Oct. 5 -- The Federal Deposit Insurance Corporation issued the following news release: * * * FDIC Issues List of Banks Examined for CRA Compliance * WASHINGTON--The Federal Deposit Insurance Corporation (FDIC) today issued its list of state nonmember banks recently evaluated for compliance with the Community Reinvestment Act (CRA). The list covers evaluation ratings that the FDIC assigned to institutions in July 2026. The CRA is a 1977 law that requires the FDIC to assess a bank's record of meeting the credit needs of its entire community, including those of low- and moderate-incomeneighborhoods, consistent with safe and sound operations. As part of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA), Congress mandated the public disclosure of an evaluation and rating for each bank or thrift that undergoes a CRA examination on or after July 1, 1990.
You may obtain a consolidated list of all state nonmember banks whose evaluations have been made publicly available since July 1, 1990, including the rating for each bank, or obtain a hard copy from FDIC's Public Information Center, 3501 Fairfax Drive, Room E-1002, Arlington, VA 22226 (877-275-3342 or 703-562-2200).
A copy of an individual bank's CRA evaluation is available directly from the bank, which is required by law to make the material available upon request, or from the FDIC's Public Information Center.
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Original text here: https://www.fdic.gov/news/press-releases/2026/fdic-issues-list-banks-examined-cra-compliance-8
El Dorado Furniture Corporation to Pay $1.3 Million to Settle National Origin Discrimination Charge
WASHINGTON, Oct. 5 -- The Equal Employment Opportunity Commission issued the following news release:
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El Dorado Furniture Corporation to Pay $1.3 Million to Settle National Origin Discrimination Charge
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MIAMI -- El Dorado Furniture Corporation, a Florida furniture company operating 19 retail stores across the state, agreed to pay $1.3 million to a class of white, black and other non-Hispanic job applicants to resolve a federal hiring discrimination investigation by the U.S. Equal Employment Opportunity Commission (EEOC), the federal agency announced today.
The EEOC's investigation found ... Show Full Article WASHINGTON, Oct. 5 -- The Equal Employment Opportunity Commission issued the following news release: * * * El Dorado Furniture Corporation to Pay $1.3 Million to Settle National Origin Discrimination Charge * MIAMI -- El Dorado Furniture Corporation, a Florida furniture company operating 19 retail stores across the state, agreed to pay $1.3 million to a class of white, black and other non-Hispanic job applicants to resolve a federal hiring discrimination investigation by the U.S. Equal Employment Opportunity Commission (EEOC), the federal agency announced today. The EEOC's investigation foundreasonable cause that the company engaged in a companywide practice of favoring Hispanic applicants for all positions and violated federal law by failing to hire a class of black, white, and other non-Hispanic applicants from November 2022 through February 2026.
"Ensuring all applicants get a fair chance at being hired regardless of their race or national origin is critical to the mission of the EEOC," said Kristen Foslid, regional attorney for the EEOC's Miami District. "We commend El Dorado for its cooperation and for undertaking significant measures to ensure that all hiring decisions going forward are based on qualifications -- not race or national origin."
The discriminatory hiring practices found by the EEOC's investigation violate Title VII of the Civil Rights Act of 1964, which prohibits discrimination based on race and national origin.
EEOC Miami District Director Evangeline Hawthorne said, "Every applicant deserves to be considered on their merits, without race or national origin being a factor. This agreement helps reinforce that principle and supports fair, merit-based hiring."
Following the EEOC's investigation, the parties engaged in the federal agency's pre-litigation conciliation process. In addition to paying monetary damages for a class of non-Hispanic applicants, El Dorado agreed to revise its hiring policies and guidelines; maintain anti-discrimination policies; train all employees involved in recruiting or hiring on discrimination annually; and provide other non-monetary relief to prevent discriminatory hiring from occurring in the future.
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Original text here: https://www.eeoc.gov/newsroom/el-dorado-furniture-corporation-pay-13-million-settle-national-origin-discrimination
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El Dorado Furniture Corporation to Pay $1.3 Million to Settle National Origin Discrimination Charge
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MIAMI -- El Dorado Furniture Corporation, a Florida furniture company operating 19 retail stores across the state, agreed to pay $1.3 million to a class of white, black and other non-Hispanic job applicants to resolve a federal hiring discrimination investigation by the U.S. Equal Employment Opportunity Commission (EEOC), the federal agency announced today.
The EEOC's investigation found ... Show Full Article WASHINGTON, Oct. 5 -- The Equal Employment Opportunity Commission issued the following news release: * * * El Dorado Furniture Corporation to Pay $1.3 Million to Settle National Origin Discrimination Charge * MIAMI -- El Dorado Furniture Corporation, a Florida furniture company operating 19 retail stores across the state, agreed to pay $1.3 million to a class of white, black and other non-Hispanic job applicants to resolve a federal hiring discrimination investigation by the U.S. Equal Employment Opportunity Commission (EEOC), the federal agency announced today. The EEOC's investigation foundreasonable cause that the company engaged in a companywide practice of favoring Hispanic applicants for all positions and violated federal law by failing to hire a class of black, white, and other non-Hispanic applicants from November 2022 through February 2026.
"Ensuring all applicants get a fair chance at being hired regardless of their race or national origin is critical to the mission of the EEOC," said Kristen Foslid, regional attorney for the EEOC's Miami District. "We commend El Dorado for its cooperation and for undertaking significant measures to ensure that all hiring decisions going forward are based on qualifications -- not race or national origin."
The discriminatory hiring practices found by the EEOC's investigation violate Title VII of the Civil Rights Act of 1964, which prohibits discrimination based on race and national origin.
EEOC Miami District Director Evangeline Hawthorne said, "Every applicant deserves to be considered on their merits, without race or national origin being a factor. This agreement helps reinforce that principle and supports fair, merit-based hiring."
Following the EEOC's investigation, the parties engaged in the federal agency's pre-litigation conciliation process. In addition to paying monetary damages for a class of non-Hispanic applicants, El Dorado agreed to revise its hiring policies and guidelines; maintain anti-discrimination policies; train all employees involved in recruiting or hiring on discrimination annually; and provide other non-monetary relief to prevent discriminatory hiring from occurring in the future.
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Original text here: https://www.eeoc.gov/newsroom/el-dorado-furniture-corporation-pay-13-million-settle-national-origin-discrimination