CFTC Withdraws Crypto Delivery Guidance, Easing Regulations for Exchanges
The CFTC has eliminated its previous guidance on cryptocurrency delivery, granting exchanges more operational leeway, as noted by StarkWare's Katherine Kirkpatrick Bos.
The U.S. Commodity Futures Trading Commission (CFTC) has retracted its former guidance on cryptocurrency delivery, allowing exchanges greater flexibility. According to the Acting Chairman, Caroline Pham, this decision removes lingering restrictions deemed outdated.
“Eliminating outdated and overly complex guidance that penalizes the crypto industry and stifles innovation is exactly what the Administration has set out to do this year,” said Pham.
Originally established in March 2020, this guidance aimed to clarify the specifics around the ‘actual delivery’ of crypto during commodity transactions. The CFTC acknowledges the necessity to reevaluate this guidance after significant developments in the last five years.
Under Pham’s leadership, the CFTC is adopting a more favorable approach toward cryptocurrencies, guided by recommendations from the president’s crypto working group to clarify how crypto is classified as commodities.
Rolling Back Delivery Regulations Opens Up Margin Trading
Katherine Kirkpatrick Bos of StarkWare praised the new direction, noting the previous guidance obstructed exchanges from offering margin trading unless actual delivery occurred within 28 days.
“This offers way more flexibility for exchanges,” she commented. “But PSA — this isn’t law! Just guidance. All of this can be changed again should leadership change.”
While the CFTC can provide guidance for legislative interpretation, this information is not binding like formal regulations.
Garry Krugljakow from aifinyo AG interpreted this change as indicative of a shift towards improved clarity for regulatory practices.
“This move signals two things: cleaner jurisdiction for the CFTC and a regulatory path designed for scale, not hesitation,” he remarked.
He also noted, “Actual delivery made sense in 2020. It doesn’t in a world of real custody, collateralization, and Bitcoin-backed credit.”
Uncertainty Due to Lack of Guidance
In contrast, Todd Phillips from the Roosevelt Institute stressed the importance of defining ‘actual delivery,’ as this determines which exchanges must register with the CFTC.
“The CFTC has replaced the prior guidance with nothing,” he pointed out. “Right now, we have no idea what the CFTC thinks actual delivery means, or who has to register.”
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