U.S. Commodity Exchange Act

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The Commodity Exchange Act (CEA) is a federal act passed in 1936 that provided for U.S. government regulation of futures trading. This act replaced the Grain Futures Act of 1922.[1] The act requires that all futures and options contracts to be traded on organized exchanges. Though there was a long gap between the Act's passage and the establishment of an independent federal agency with real teeth -- the U.S. Commodity Futures Trading Commission (CFTC) -- it nonetheless did establish important guidelines for the industry. Prior to the establishment of the CFTC in 1974, the U.S. Department of Agricultural's Commodity Exchange Authority (also CEA) was the overseeing agency for futures. The CFTC's oversight replaced the regulatory authority of the CEA.