USCA4 Appeal: 25-1892
Doc: 16
Filed: 10/15/2025
Pg: 48 of 97
“bestowed on the CFTC exclusi [ve] jurisdiction to regulate futures trading
… , thereby preempting any State regulatory laws.” H. R. Rep. No. 97-565, pt. 1, at 44; see also H.R. Rep. No. 106-711, pt. 2, at 71 (“the current” CEA already
“ supersedes and preempts” state laws “in the case of transactions conducted
on a registered entity ” ). Subsequent CEA amendments allowing states to regulate off-DCM trading rested critically on Congress’s recognition that the 1974 amendments prohibited states from regulating on-DCM trading. 6. Finally, the “pervasive” regulatory framework for regulating trading on DCMs confirms that Congress preempted the field. Arizona , 567 U.S. at 399. Congress in the CEA created “a comprehensive regulatory structure” to oversee the “futures trading complex.” Curran , 456 U.S. at 356 (citation
omitted). That scheme leaves no room for parallel state regulation.
CFTC regulation covers the lifecycle of an exchange. To list derivatives contracts, an exchange must receive CFTC designation. See 7 U.S.C. § 7(a).
That process requires an application demonstrating myriad capabilities,
including the capacity to detect and investigate actors who violate CFTC rules, 17 C.F.R. § 38.150(b), to retain adequate compliance staff, id . § 38.155(a), to surveil trades executed on its platform, id . § 38.156, and more. Once the market becomes a DCM, it is subject to extensive oversight, including recordkeeping requirements, id . § 38.950, reporting obligations,
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