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Source: US SEC and CFTC
The Securities and Exchange Commission (SEC) Trading and Marketing Department, as well as the Commodity Futures Trading Commission (CFTC) Market Oversight and Clearing and Risk Department have announced an inter-agency initiative to further advance the SEC’s Project Crypto and CFTC’s Crypto Sprint to coordinate efforts to enable the trading process for certain spot crypto asset products.
The President’s Digital Asset Markets Working Group entitled “Strengthening the U.S. Leadership in the Field of Digital Financial Technology” (“PWG Report”) recommends that the U.S. SEC and CFTC should be coordinated to make the U.S. the best place to use blockchain technology to innovate and participate in the crypto asset market.Specifically, the PWG report recommends that both agencies should use existing powers to promote “regulatory transparency to maximize the limit of blockchain-based innovation within the United States.”As part of this work, the two departments are coordinating the release“About the listing and trading of spot retail digital assets commodities with leverage, margin or financing”guide to implement the recommendations of the PWG report.
This joint statement expresses the views of both departments,That is, current laws do not prohibit the promotion of transactions of these spot crypto asset products on exchanges registered with SEC or CFTC.As stated in the PWG report, coordination among various departments will promote the selection and selectivity of trading venues for market participants in the United States.To achieve these goals,The two departments are ready to support their respective institutions to consider trading exchanges for certain spot crypto asset products.
Spot goods
Unless there are exceptions or other appropriate remedies,The Commodity Trading Act (CEA) stipulates that certain leveraged, margined or financing-based “retail commodity trading” must be conducted on a designated contract market (DCM) registered by the CFTC or a foreign exchange registered by the CFTC (FBOT).One exception is the retail commodity trading listed on the SEC-registered national stock exchange (NSE).The two departments said todayDCM, FBOT and NSE are not prohibited from promoting transactions on certain spot crypto asset products.Market participants can communicate with SEC or CFTC staff as needed.
Considerations for market participants
The department will promptly review applications and requests submitted by DCM, FBOT and NSE to facilitate transactions in certain spot crypto asset products.The Department is ready to answer any questions when market participants are ready to submit any necessary registration, proposal or appropriate remedy request to the SEC and/or CFTC.The following notes are relevant to market participants seeking to operate the market and trade spot crypto asset products:
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Margin, Clearing and Settlement: The Department believes that applicable rules allow clearing houses to work with custodians to maintain customer accounts.
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The U.S. SEC Trading and Marketing Department is ready to answer questions about the U.S. SEC registration clearing agencies that you want to participate in.
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The CFTC Clearing and Risk Division is ready to answer questions from the CFTC Registered Derivatives Clearing Organization (DCO).
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The department is ready to resolve any regulatory issues related to the business relationship between the DCO and the NSE.
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Basic Market Monitoring: Departments believe that the shared reference pricing platform of national stock exchanges (NSE), designated contract markets (DCMs) and overseas exchanges (FBOTs) will help enhance market supervision effectiveness.All departments are ready to answer any questions related to effective information sharing.
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Public release of transaction data: The department believes that public release of transactions on national stock exchanges (NSEs) and designated contract markets (DCMs) can provide valuable data to the public.The department is ready to answer any questions regarding the provision of NSE and designated contract market data for spot crypto assets to the public.
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Promoting a fair and orderly market: This department believes that efficient execution and transparency can promote trading opportunities and promote competition among market participants.This department is preparing to cooperate with trading venues to practice the principle of fairness and order in the process of working hard to operate the market for participants to trade spot crypto asset products.
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Investor and Customer Protection Innovation: Departments are ready to work with market participants to encourage technological innovation in markets and transactions while ensuring investors and customers protection.
“Today’s joint statement represents an important step in bringing innovation in the crypto asset market back to the United States. Market participants should have the freedom to choose where to trade spot crypto assets. The SEC is committed to working with the CFTC to ensure that our regulatory framework supports innovation and competition in these rapidly evolving markets.”
“Under the last administration, our two agencies sent mixed signals about regulation and compliance in the digital asset market, but the message is clear: innovation is not welcome. This phase is over,” said Caroline D. Pham, acting chairman of the CFTC.“Through collaboration, we can empower the United States to innovate in these markets and further promote the United States to become the world’s cryptocurrency capital on the way President Trump cooperates. Today’s joint statement is the latest embodiment of our shared goal of supporting growth and development in these markets, but this will never be the last.”
The U.S. SEC Trading and Marketing Department, the U.S. CFTC Market Supervision Department and the Clearing and Risk Department are coordinating efforts to facilitate the transaction of certain spot crypto asset products on registered exchanges.The move is part of the U.S. SEC Project Crypto and U.S. CFTC Crypto Sprint initiatives and is based on recommendations from the President’s Digital Assets Markets Task Force on “Strengthening U.S. Leadership in Digital Financial Technology.”
Each department is ready to communicate with market participants and supports their respective institutions to consider trading certain spot crypto asset products on exchanges.Market participants are welcome to communicate with US SEC or US CFTC staff to discuss any issues or concerns they may encounter if necessary.
