Summary
- The US Commodity Futures Trading Commission said it had issued a no-action letter allowing the conversion of cryptocurrency perpetual futures contracts.
- Designated contract markets, or DCMs, can convert existing digital commodity futures contracts into “true digital commodity perpetual futures” by removing the expiration date.
- The no-action letter requires customer protections, procedural compliance and self-certification under CFTC rules, and expires on June 30.
Forecast Trend Report by Period
The US Commodity Futures Trading Commission has taken steps to ease the regulatory burden on exchanges offering perpetual cryptocurrency futures contracts.
On June 12, the CFTC issued a no-action letter allowing designated contract markets, or DCMs, to convert existing digital commodity futures contracts into what it called “true digital commodity perpetual futures.”
The move extends the regulator’s recent efforts to clarify its approach to actively traded cryptocurrency futures. Under the guidance, DCMs can convert existing contracts by removing their expiration dates. They must still meet customer-protection and procedural requirements.
Exchanges must seek investor feedback, provide advance notice, give traders an opportunity to close positions, and disclose risks. They cannot change other core terms of the existing contracts.
Exchanges must also file the amendments with the CFTC under agency rules and self-certify compliance with the requirements. The no-action letter expires on June 30.
