The U.S. Commodity Futures Trading Commission (CFTC) has taken another key step in modernizing financial markets. CFTC Acting Chair Caroline Pham announced the launch of the 'Digital Assets Pilot Program' on Monday, allowing the use of certain cryptocurrencies as collateral in the derivatives market.
Currently, this pilot program is only applicable to futures commission merchants (FCMs) that meet specific criteria, allowing these operators to accept Bitcoin, Ethereum, or payment stablecoins (such as USDC) as margin collateral for futures and swap contracts.
However, FCM must also comply with strict reporting and custody requirements, such as disclosing the digital asset holdings on a weekly basis in the first three months. If there are any operational issues, interruptions, or failures, they must also promptly report to the CFTC.
In other words, a registered futures merchant may, under a compliant framework, accept customers using Bitcoin as collateral to undertake certain leveraged swap contracts linked to commodities, while the CFTC closely monitors asset custody, operational processes, and risk management to ensure market stability.
At the same time, the CFTC also issued a 'no-action letter', allowing FCMs to hold specific digital assets in segregated customer accounts under strict risk management.
More importantly, the CFTC simultaneously withdrew the old guidance issued in 2020, which had previously hindered the use of cryptocurrency as collateral in most cases, making it difficult for many financial institutions to implement it despite demand. With the formal passage of the (GENIUS Act), the CFTC determined that the old regulations were no longer applicable to today's market environment and thus fully repealed them.
"Cryptocurrency moves towards mainstream finance! The US CFTC opens the use of BTC and ETH as margin collateral" This article was first published on (Block客).
