CFTC Withdraws Outdated Bitcoin Guidance
The U.S. Commodity Futures Trading Commission (CFTC) has officially withdrawn its 2020 guidance on “actual delivery” for Bitcoin and other digital currencies. This decision, announced by Acting Chair Caroline Pham on December 11, marks a significant step toward modernizing the regulation of cryptocurrencies.
Why the Guidance Was Removed
The withdrawn guidance defined the conditions for leveraged or margined crypto purchases to be considered “actual delivery” within a 28‑day window. It was deemed outdated and inconsistent with the current state of the market. Pham noted that the guidance was introduced when regulators were uncertain about the development of virtual‑currency markets. With the growth of the market and improved custody practices, these rules no longer align with industry operations.
Streamlining Regulations for Crypto Firms
This move is part of a broader effort by the CFTC to streamline regulations and reduce compliance burdens for crypto firms. By eliminating outdated rules, the agency aims to foster innovation and provide safer alternatives to offshore platforms for U.S. traders.
Spot Crypto Trading Approval
Recently, the agency approved spot crypto trading on federally regulated futures exchanges, a first for the industry. This decision allows Bitcoin and Ethereum to be regulated under the CFTC’s general, technology‑neutral framework, normalizing their treatment alongside traditional commodities.
Tokenized Collateral Pilot Program
The CFTC is also exploring the use of tokenized collateral in derivatives markets through a pilot program launched on December 8. The program allows Bitcoin, Ether, and USDC to be used as collateral, providing the agency with real‑time insights into how tokenized assets behave under regulated conditions.
The “Crypto Sprint” Initiative
These efforts are part of the CFTC’s “Crypto Sprint,” an initiative aimed at examining tokenized collateral, stable‑coin use in derivatives markets, and ways to modernize clearing and settlement rules through blockchain systems. The agency has also issued guidance confirming that tokenized real‑world assets, such as U.S. Treasuries and money‑market funds, can be evaluated within the existing regulatory framework.
Leadership Transition
As the CFTC undergoes a leadership transition, with Pham expected to step down once President Donald Trump’s nominee, Michael Selig, is confirmed by the Senate, the agency remains committed to providing safer alternatives to offshore platforms for U.S. traders.
