Author：Light blue and deep blue
In her latest move to update financial markets, Commodity Futures Trading Commission Acting Chair Caroline Pham debuted a "digital assets pilot program" allowing certain cryptocurrencies to be used as collateral in derivatives markets.
At the onset, the pilot program will be limited to bitcoin, ETH, and USDC, Pham said on Monday.
"As I’ve said before, embracing responsible innovation ensures that U.S. markets are the world leader, and drives progress that will unleash U.S. economic growth because market participants can safely put their dollars to work smarter and go further," Pham said in a statement.
Pham, the agency's lone commissioner, has forged ahead with defining the derivatives regulator's stance on crypto. Last week, Pham announced that Bitnomial had become the first exchange to list regulator-approved spot crypto products. Previously, Pham launched the "Crypto Sprint" program to clarify rules for crypto and floated the idea of piloting a digital asset regulatory sandbox in the U.S.
Monday's announcement builds on a CFTC initiative in September to expand the use of tokenized collateral, particularly stablecoins, in derivatives markets.
In a letter posted by the CFTC in response to Coinbase, the CFTC said futures commission merchants (FCMs) involved in the crypto collateral program would have to file weekly reports on the total amount of digital assets held in customer accounts, such as futures and cleared swaps. FCMs would also have to report any "significant operation or system issue, disruption, or failure" affecting the digital assets being used as collateral, according to the letter.
"The CFTC's decision confirms what the crypto industry has long known: That stablecoins and digital assets can make payments faster, cheaper, and reduce risk,” Coinbase Chief Legal Officer Paul Grewal said in a statement.
On Monday, the CFTC also withdrew a staff advisory that restricted an FCM's "ability to accept virtual currencies as customer collateral," noting the GENIUS Act regulating stablecoins made it outdated since it passed into law over the summer.
