CFTC staff details how crypto firms can use digital assets as derivatives collateral in new FAQ
The CFTC staff released an FAQ detailing how FCMs and clearinghouses can handle crypto assets used as collateral in derivatives markets.Summary
Staff at the Commodity Futures Trading Commission (CFTC) published a new Frequently Asked Questions (FAQ) document outlining operational details for Futures Commission Merchants (FCMs) and clearinghouses regarding the use of crypto assets as collateral in derivatives markets. This guidance harmonizes capital charge frameworks with the SEC, requiring FCMs holding proprietary positions in bitcoin or ether to apply a minimum 20% capital charge, while payment stablecoins receive a 2% charge. The FAQ restricts FCMs from investing customer funds in payment stablecoins or depositing non-stablecoin crypto assets in segregated customer accounts, though FCMs can deposit their own payment stablecoins as residual interest. For uncleared swaps, swap dealers cannot use crypto assets as margin collateral, except for tokenized versions of eligible assets. Derivatives Clearing Organizations (DCOs), however, can accept crypto as initial margin for cleared transactions, setting their own haircuts subject to review. Firms relying on the underlying no-action letter must file a notice and undergo an initial three-month period with reporting requirements and restrictions on accepted crypto types. The FAQ also provides a two-phase definition for "payment stablecoin," transitioning to the GENIUS Act framework once effective.
(Source：The Block)