Good afternoon.

It’s a pleasure to be here today at the U.S. Treasury Market Conference. I want to thank President John Williams and the New York Fed for inviting me to share my perspective before such a wonderful audience. 

It’s great to be back in New York City, the heartbeat of global financial markets. I spent over a decade in private practice here, and it’s the honor of a lifetime being able to speak today from the other side of the table as a public servant. 

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.

When the U.S. derivatives markets are functioning well, they quietly perform two of the most important jobs in our economy: helping businesses hedge risk, which improves the allocation of capital, and facilitating price discovery, which allows markets to function efficiently and transparently. And there is no better example of this than in the U.S. Treasury market. 

The U.S. Treasury market is the foundation of the global financial system. It funds the U.S. government, provides the benchmark for interest rates throughout the economy, and serves as a critical source of liquidity and collateral. And it is one of the reasons why the U.S. dollar remains the world’s reserve currency. Simply put, the U.S. Treasury market is the envy of the world. 

Over the past twenty years, global derivatives markets have nearly doubled to $1.2 quadrillion notional, nearly half of which is overseen by the CFTC. Their growing importance is particularly evident in the Treasury market, where daily Treasury futures turnover has risen from roughly $200 billion to $900 billion during that same time period, while short-term interest rate futures such as SOFR have increased from roughly $2 trillion to $5 trillion. 

But the transformation is not simply one of scale. The financial architecture around the Treasury market has evolved alongside it. 

Repo and the cash-futures basis trade also now play a much larger role in financing, hedging and arbitrage. In 2006, related short term Treasury futures had roughly $10 trillion in open interest. Today, the similar short term U.S. interest-rate complex exceeds $60 trillion.

Alongside futures, the swaps market has expanded dramatically as well. USD interest-rate derivatives now average over $2 trillion in daily turnover, compared to roughly $300 billion a day in 2007. Overnight index swaps now represent a substantial share of that activity.

These numbers tell us something important: the Treasury market has not simply become larger. Its structure has changed.

Derivatives—including futures, options and swaps—are no longer simply instruments used to hedge positions in the cash Treasury market. They are part of the core market ecosystem—central to liquidity, risk transfer and increasingly to price discovery.

Today’s Treasury market is therefore fundamentally different from the market we knew two decades ago. And that means the CFTC must be different as well.

Our role can no longer be viewed simply through the lens of individual futures or swaps markets. 

The derivatives markets we oversee are now deeply interconnected with the cash Treasury market, repo, financing, and the broader Treasury ecosystem, and the CFTC sits at the center of these global financial markets.

This places an extraordinary responsibility on the agency. We need to regulate the marketplace as it function today, not as it functioned twenty years ago. That means better data, more integrated surveillance, a sharper focus on cross-market risks, and the ability to see how positions, leverage and liquidity interact across futures, swaps and cash markets.

The objective is not simply to regulate more. It is to regulate differently, with greater speed, greater precision, and a much more complete view of market structure. It will require a deeper understanding and assessments of these markets to detect vulnerabilities and risk and proactively working with our fellow agencies in protecting the deepest and most valuable marketplace in the world.

The CFTC, under my leadership, plans to embrace that change. As President Reagan once said, “the future doesn’t belong to the fainthearted; it belongs to the brave.” That has always been the American approach to innovation – embracing ideas, encouraging entrepreneurship, and building the markets of tomorrow. 

Today, we are entering another period of rapid transformation. Markets are increasingly operating across digital infrastructure through blockchain technology, stablecoins, and other innovative technologies. Trading continues to become faster, more automated, and increasingly global. And participants expect markets that are more accessible, more efficient, and in many cases, available on a continuous, 24/7 basis. 

What We’ve Done

At the CFTC, we are delivering on our mandate to ensure that our regulatory regime is purpose-fit today for the innovations of tomorrow. 

And the way we regulate these markets matters – not only to those trading in them – but to the broader strength and resilience of the American financial system. 

Since I rejoined the agency last December, the CFTC has taken meaningful steps to right-size regulation, reduce overburdensome and duplicative rules, and provide clear rules of the road for all market participants.

The Commission has worked diligently to advance Treasury market reforms and deliver on the SEC’s Treasury Clearing Mandate ahead of the December 31^st, 2026 deadline for cash Treasuries and the June 30^th, 2027 deadline for Treasury repo transactions. As the SEC’s Treasury clearing requirements bring more Treasury transactions into central clearing, market participants increasingly have positions spanning SEC- and CFTC-regulated clearing infrastructures.

Earlier this year, the CFTC, along with the SEC, approved exemptive orders allowing CME and FICC to expand their cross-margining arrangement beyond clearing members and to customers for Treasury securities and futures positions, allowing risk to be managed more holistically and reducing unnecessary margin costs for a broader swath of market participants.[1]

As part of this order, dually registered broker-dealers and futures commission merchants (FCMs) may now hold futures customer funds in a commingled customer account at FICC, resulting in reductions in required collateral while ensuring customer funds remain appropriately protected.[2] I have directed staff to make the necessary adjustments to our rulebook to permit FCMs to engage in cleared repo transactions involving customer funds ahead of the June 2027 Clearing Mandate deadline for Treasury repos. 

The Commission expects to see similar cross-margining programs submitted for regulatory approval from other clearing agencies, and I look forward to working with Chairman Atkins to ensure a smooth transition ahead of the “go live” dates in the coming months.   

In addition, as part of an unprecedented agency harmonization effort, the CFTC and SEC have sought public comment on ways to harmonize portfolio-margining frameworks.[3] Our joint request for comment on portfolio margining frameworks asks how the agencies can better recognize economically related positions and cross-product offsets, including across clearing organizations, rather than requiring market participants to maintain duplicative margin.[4] This work builds on our FICC-CME cross-margining efforts and demonstrates how CFTC-SEC harmonization can translate into more efficient clearing, lower collateral costs, and greater liquidity and resilience in the Treasury market.

Finally, as cross-margining programs continue to expand and risk profiles evolve, the CFTC is working alongside our interagency partners to ensure that the recent Basel III proposal’s capital requirements are appropriately tailored to actual risk, lower the cost of entry for businesses across the United States, and increase participation in derivatives markets. The agency will continue to consider what legacy capital, margin, or reporting rules should be amended to properly reflect the new Basel III proposal. 

Looking Ahead

However, in order to embrace innovation, we cannot simply modernize yesterday’s markets. We have to prepare for tomorrow’s. 

The work will not be easy, but preparing our markets for the new frontier of finance is imperative. This means readying our markets for mass tokenization, tailoring legacy frameworks so that innovative technologies, such as blockchains and artificial intelligence (“AI”), can be adopted at scale, and ensuring our market participants are prepared for the world of onchain finance and 24/7 markets. 

One of the most important innovations is the tokenization of real‑world assets. As I remarked earlier in my tenure as Chairman, high-quality tokenized collateral has the potential to make liquidity more dynamic and markets more resilient. 

It is easy to see how using blockchain technology and tokenized assets could become the foundation of a more efficient financial system – a financial system that I suspect many of you believe is long overdue for the 21^st century. It is one that enables near‑instantaneous settlement and real‑time collateral mobility across clearinghouses, intermediaries, and end users, all with the attributes of what makes America’s financial markets the gold standard. Just as the transition from hand signals to electronic trading advanced our financial system, I believe tokenization can do the same for all asset classes.

As tokenization and onchain finance continue to evolve, the CFTC is committed to providing clear, principles-based rules to ensure that these innovations foster growth and preserve market integrity. Our goal is simple: digital technologies should make America’s markets more efficient, more resilient, and more competitive. 

To realize this goal, stablecoins will play an important role. Thanks to the leadership of President Trump, the GENIUS Act is now the law of the land, and the CFTC has been hard at work addressing stablecoins in our derivatives markets. Earlier this year, the agency expanded the list of eligible tokenized collateral to include certain payment stablecoins issued by national trust banks[5] and released a robust set of frequently asked questions,[6] which it continues to iterate on, concerning the use of tokenized collateral in our markets. Going forward, the Commission is committed to finding additional ways to encourage responsible stablecoin adoption for market participants, exchanges, and clearinghouses.

As our markets continue to globalize, and as advances in trading platforms, connectivity, and settlement technologies accelerate, the Commission has seen an increased interest around continuous, and 24/7 trading. Our derivatives markets serve participants in every time zone around the world, and the infrastructure supporting them is increasingly capable of operating around the clock.

Although many markets are moving toward continuous trading, that does not mean all markets are ready to make that change today. I have been clear that, under my leadership, the Commission will not take a one‑size‑fits‑all approach to 24/7 trading. Market structure evolves best through thoughtful and responsible progress, not by assuming that what works for one product or venue works universally. 

That is why the Commission sought public comment on the suitability of certain asset classes for 24/7 trading[7] and why CFTC staff issued an advisory on 24/7 trading, clearing, and settlement.[8] While certain asset classes, such as crypto or precious metals, may currently be suitable for 24/7 trading, others, like agricultural products, energy, and certain financials, may not.

A transition to broader trading hours must be done responsibly, grounded in a commitment to the agency’s mandate of fostering responsible innovation and promoting market integrity. The Commission’s role is to ensure our surveillance systems, margin frameworks, and operational safeguards are prepared to function continuously should the markets decide to move toward a 24/7 framework.

Our principles‑based approach remains our north star. The agency will support innovation that enhances resilience and competitiveness, while ensuring that any expanded trading hours promote the core functions of our derivatives markets.

Conclusion

The United States is the financial markets capital of the world. We have innovative firms, world-class exchanges, strong market participants, and now, regulators committed to promoting market integrity while supporting responsible innovation.

Those advantages will matter. With developments like tokenization, onchain finance, and 24/7 trading, the next decade will likely bring more change to financial markets than the previous several decades combined. If the question is, will the United States continue leading in these markets, then I say, yes, we will. Across the entire Trump Administration, we’ve already laid the groundwork to continue doing so by embracing innovation, encouraging competition, rightsizing regulation, and maintaining the trust that has made our markets the gold standard across the globe. 

Thank you again to the New York Fed for the warm welcome, and I’m looking forward to hearing more on some of these topics from our next panel.

[1] Order Providing Exemptive Relief to Facilitate Cross-Margining of Customer Positions Cleared at Chicago Mercantile Exchange, Inc. and Fixed Income Clearing Corporation, 91 Fed. Reg. 20880 (Apr. 20, 2026); Order Under Section 36 of the Securities Exchange Act of 1934 (the “Exchange Act”) Granting Conditional Exemptive Relief from Section 15(c)(3) of and Rule 15c-3 Under the Exchange Act for Cross-Margining of Cleared U.S. Treasury Securities and Related Futures, 91 Fed. Reg. 21035 (Apr. 20, 2026).

[2] Id.

[3] Joint Request for Comment on Further Implementation of Portfolio Margining and Cross-Margining of Securities and Derivatives, 91 Fed. Reg. 39579 (June 30, 2026).

[4] Id.

[5] Staff No-Action Position Regarding Digital Assets Accepted as Margin Collateral, CFTC Letter No. 26-05 (Feb. 6, 2026).

[6] CFTC Staff Issues FAQs Concerning Registrant and Registered Entity Activities Relating to Crypto Assets and Blockchain Technologies, CFTC (Mar. 20, 2026), https://www.cftc.gov/PressRoom/PressReleases/9200-26.

[7] Request for Comment on the Extension of Standard Futures Contracts to 24/7 Trading and on Perpetual Contracts Referencing Physically Delivered or Storable Energy Commodities, 91 Fed. Reg. 38334 (June 25, 2026).

[8] Staff Advisory for Extending Trading and/or Clearing Operations to a 24 hours-a-day, 7-days-a-week Basis, CFTC Letter No. 26-16 (May 29, 2026).