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CFTC (Commodity Futures Trading Commission)

Also called: us cftc, commodity futures trading commission

The US government regulator for futures, options, and forex — enforces strict rules on retail forex brokers operating in the US.

The Commodity Futures Trading Commission is the US government agency that regulates futures, options, and derivatives markets, including retail forex. The CFTC works alongside the National Futures Association (NFA), which handles day-to-day oversight of registered brokers. To legally offer forex to US retail clients, a broker must be registered with the CFTC and be an NFA member. US forex regulation is among the strictest in the world. CFTC rules cap retail leverage at 1:50 for majors and 1:20 for minors, prohibit hedging on the same account (FIFO rules require first-in-first-out order matching), and require brokers to hold client funds in US banks with specific capital reserves. The strict rules have pushed most global forex brokers out of the US market. Only a handful of brokers (OANDA, FOREX.com, TD Ameritrade, Interactive Brokers) actively serve US retail clients. The trade-off is safety — US-regulated brokers are very safe, but you have fewer choices.

Real trade example

The CFTC has fined and shut down dozens of fraudulent forex operations targeting US retail traders over the past decade. The strict enforcement is why US forex, while limited in choice, is one of the safest retail markets globally.

Related terms

Broker Regulation

beginner

The government or industry body that oversees a broker and enforces rules on capital requirements, disclosures, and client protection.

NFA (National Futures Association)

beginner

The self-regulatory body for US futures and forex brokers — works alongside the CFTC to oversee the industry.

Broker

beginner

The company that gives you access to the forex market — the middleman between you and the currency you want to trade.

FCA (Financial Conduct Authority)

beginner

The UK's top-tier financial regulator — one of the strictest and most respected in the world for forex and CFD brokers.

ASIC (Australian Securities & Investments Commission)

beginner

Australia's top-tier financial regulator — oversees forex and CFD brokers with strict rules on leverage, disclosures, and client protection.

ECN Broker

intermediate

A broker that routes orders directly to a network of liquidity providers without taking the other side — no conflict of interest.

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