CFTC Says 24/7 Derivatives Trading Suits Crypto Markets, Not Some Traditional Ones

The US Commodity Futures Trading Commission warned that expanding 24/7 trading in derivatives markets could introduce new risks, underscoring structural differences between cryptocurrency markets and traditional finance.

CoinDesk reported on May 29 that the CFTC said in an advisory that a 24-hour trading model may suit blockchain-based firms but may not be appropriate for some traditional markets.

Because market structures differ, a 24/7 trading and clearing framework is not suitable for every asset class, the agency said.

In some markets or products, longer trading hours could reduce liquidity, increase volatility and widen bid-ask spreads. That environment could also increase the risk of market manipulation.

Round-the-clock trading is already standard in crypto markets, while traditional financial markets such as stocks and futures still operate on limited hours. Some exchanges and financial institutions have recently been considering longer trading sessions.

As trading infrastructure develops, the debate over extending trading hours is set to continue. Oversight frameworks, liquidity management and market stability remain key challenges.