Mission & Responsibilities

The mission of the Commodity Futures Trading Commission (CFTC) is to foster open, transparent, competitive, and financially sound markets. By working to avoid systemic risk, the Commission aims to protect market users and their funds, consumers, and the public from fraud, manipulation, and abusive practices related to derivatives and other products that are subject to the Commodity Exchange Act (CEA)..

To promote market integrity, the CFTC polices the derivatives markets for various abuses. It also seeks to lower the risk of the futures and swaps markets to the economy and the public.
 

The agency oversees a variety of individuals and organizations. These include swap execution facilities, derivatives clearing organizations, designated contract markets, swap data repositories, swap dealers, futures commission merchants, commodity pool operators, and other entities.

 

The Commission was established as an independent agency in 1974, assuming responsibilities that had previously belonged to the Department of Agriculture since the 1920s. The Commission historically has been charged by the CEA with regulatory authority over the commodity futures markets. These markets have existed since the 1860s, beginning with agricultural commodities such as wheat, corn, and cotton.

 

Over time, these commodity futures markets, known as designated contract markets (DCMs) regulated by the Commission, have grown to include those for energy and metals commodities such as crude oil, heating oil, gasoline, copper, gold, and silver. The agency now also oversees DCMs for financial products such as interest rates, stock indexes, and foreign currency.

 

 

In the aftermath of the 2008 financial crisis, which was caused in part by the unregulated swaps market, President Obama and Congress enhanced the CFTC’s regulatory authority. With passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), the agency now also oversees the more than $400 trillion swaps market, which is about twelve times the size of the futures market.

 

 

The futures and swaps markets are essential to our economy and the way that businesses and investors manage risk. Farmers, ranchers, producers, commercial companies, municipalities, pension funds, and others use these markets to lock in a price or a rate. This helps them focus on what they do best: innovating, producing goods and services for the economy, and creating jobs. The CFTC works to ensure these hedgers and other market participants can use markets with confidence.