Selig tells the Treasury market to get ready

The chairman of the Commodity Futures Trading Commission chose the most conservative room in American finance to say that the plumbing is about to be replaced.

Speaking on Tuesday at the 2026 U.S. Treasury Market Conference hosted by the Federal Reserve Bank of New York, Michael Selig told an audience of primary dealers, clearing houses and central bankers that "with developments like tokenization, on-chain finance, and 24/7 trading, the next decade will likely bring more change to financial markets than the previous several decades combined," according to the Commission's text of his remarks.

That is a large claim to make in front of that particular audience. The Treasury market is the one piece of market infrastructure nobody is willing to experiment with, and Selig acknowledged as much by grounding the argument in collateral rather than in trading. High-quality tokenised collateral, he said, "has the potential to make liquidity more dynamic and markets more resilient", by allowing near-instantaneous settlement and the real-time movement of margin between clearing houses, intermediaries and end users.

The collateral framing is the practical one. A clearing house does not care whether an asset sits on a ledger; it cares whether the asset can be delivered to it at three in the morning on a day when prices are moving. The CFTC has already taken one step in that direction: earlier this year it expanded the list of eligible tokenised collateral to include payment stablecoins issued by national trust banks, and published a set of frequently asked questions on how tokenised collateral may be used. Selig said the Commission would continue to "encourage responsible stablecoin adoption for market participants, exchanges, and clearinghouses", and credited the GENIUS Act, now in force, for making that possible.

On continuous trading he was notably less expansive than the headline suggests. There will be no "one-size-fits-all approach to 24/7 trading", he said: crypto and precious metals may suit it, agricultural and energy contracts may not, at least for now. Commission staff issued advisory letters on extending trading and clearing hours in May. The chairman is describing a direction of travel, not a deadline.

What gives the speech its weight is the legislative vacuum behind it. On 15 September the Senate declined to open debate on the CLARITY Act, the market-structure bill that would have divided jurisdiction over digital assets between the CFTC and the Securities and Exchange Commission and given the CFTC an explicit statutory mandate over spot trading in digital commodities. Cloture failed 49 to 50. The bill did not fall over the market rules; it fell over ethics provisions covering a president's crypto profits. The rules themselves had broad support and no vehicle.

The agencies responded by not waiting. Two days after the vote, the CFTC sent a draft rulemaking titled Regulation Crypto Asset Transactions and Regulation Crypto Asset Markets to the White House Office of Information and Regulatory Affairs for review, CNBC reported. The same day the SEC issued the order that opened a five-year pathway for trading certain tokenised stocks, an exemption the sell side has already worked out the winners from.

Rulemaking is a weaker instrument than a statute and everyone involved knows it. A rule can be challenged in court, rewritten by a later commission, or narrowed by an agency that finds its authority does not reach as far as it hoped. A statute settles the jurisdictional question; a rule merely asserts an answer to it. Firms deciding whether to build tokenised market infrastructure in the United States are being asked to rely on the second while the first remains unavailable.

The rest of the speech was about the Treasury market as it already exists, and it was the more concrete half. Selig noted that daily turnover in Treasury futures has risen from about $200bn to about $900bn over twenty years, and that short-term interest rate futures have gone from roughly $2trn to $5trn. He pointed to exemptive orders from the CFTC and SEC allowing CME and the Fixed Income Clearing Corporation to extend cross-margining of Treasury positions to customers, a joint request for comment on portfolio margining issued on 30 June, and an instruction to staff to adjust the rules so that futures commission merchants can enter cleared repo transactions with customer funds before the Treasury repo clearing mandate takes effect on 30 June 2027.

Those are the measures that will move money this year. Mass tokenisation is the framing; customer cross-margining and cleared repo are the policy. The gap between the two is roughly the gap between what the chairman can describe and what he can currently require.