On December 8, the CFTC announced a series of actions to provide regulatory clarity and support responsible innovation in digital asset markets. Acting Chair Caroline Pham stated the actions implement recommendations from the president’s Working Group on Digital Asset Markets’ report (covered by InfoBytes here) and follow the CFTC’s Crypto Sprint initiative.

Tokenized Collateral Guidance:

CFTC staff issued new guidance permitting the use of tokenized assets, including bitcoin, ether, stablecoins, U.S. Treasury securities, and money market funds, as collateral in derivatives markets. The guidance emphasized that CFTC regulations are technology-neutral and encouraged firms to analyze tokenized assets individually under existing frameworks. It also addressed eligible tokenized assets, legal enforceability, segregation and custody, valuation, and operational risks.

No-action Letter and Pilot Program for Futures Commission Merchants:

The CFTC’s Market Participants Division issued a no-action letter establishing a pilot program for futures commission merchants (FCMs) to accept certain non-securities digital assets, including payment stablecoins, as margin collateral and to hold proprietary payment stablecoins in segregated customer accounts. The CFTC stated that, for the first three months, FCMs that rely on the no-action letter: (i) may accept only bitcoin, ether and payment stablecoins as margin collateral; (ii) must provide weekly digital asset account reports; and (iii) must promptly notify CFTC staff of any significant issues.

Withdrawal of Prior Advisory:

The CFTC also withdrew a staff advisory (No. 20-34), that had previously placed restrictions on FCMs’ ability to accept virtual currencies as customer collateral. The agency cited “substantial developments” in digital asset markets and the enactment of the GENIUS Act as reasons for the withdrawal.