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    CFTC backs blockchain integration in US futures and crypto markets with potential plans for a crypto-friendly commissioner

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    HI, Close look at crypto, CFTC, C-man, coin

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    The Commodity Futures Trading Commission (CFTC) supports the use of blockchain technology in US futures markets for trading collateral, with the goal of eliminating the need for brokers and simplifying asset transfers. The CFTC is also considering using the technology to manage crypto markets. Future plans might see the appointment of a crypto-friendly commissioner to head the CFTC. Meanwhile, the Depository Trust and Clearing Corporation has run a pilot program to settle trades using blockchain technology.

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    The Commodity Futures Trading Commission (CFTC) is getting behind blockchain technology for trading collateral in US futures markets, according to a recent report. The use of blockchain tech like distributed ledgers and tokenization can solve some existing issues in traditional futures exchanges and widen the range of assets used for collateral trades.

    CFTC Commissioner Caroline D. Pham excitedly declared that we can now start moving forward with clarity on US regulatory frameworks for digital assets. As she pointed out, asset tokenization has been successful all around the world. One of the big perks of blockchain networks is that they can make it easier to transfer assets at any time, without complicated and expensive intermediary arrangements, the report states.

    The idea is that a person who owns an asset can move or pledge that asset without needing a broker to help out. On a related note, The Depository Trust and Clearing Corporation (DTCC) is running a pilot program to get trades settled using blockchain networks.

    When a trade is set up, traders usually have to provide collateral – sometimes called “margin” – to make sure the trade goes through. The CFTC is all about managing commodity futures markets in the US, which includes overseeing crypto markets.

    There are some big changes coming up in this area, with President-elect Donald Trump having plans to become the “world’s crypto capital” once his presidential term begins on Jan. 20, 2025. Word on the street is that he might be considering tapping a crypto-friendly commissioner to head up the CFTC.

    During President Joe Biden’s term, both the Securities and Exchange Commission (SEC) and CFTC took a pretty aggressive approach to regulating crypto, leading to a lot of regulatory actions against companies in the industry. There is some speculation about who might become chair of the CFTC in the future, with some betting on Commissioner Pham, who has previously spoken out in favor of crypto.

    Recently, SEC Chair Gary Gensler announced his departure from the SEC, coming into effect on Jan. 20, 2025. Trump is also rumored to be considering the idea of creating a new Crypto role in the White House.

    Before all of this post-election buzz, we saw increasing signs that regulators and trading platforms were starting to welcome the idea of using cryptocurrency for trades. In fact, the DTCC, which is the main clearinghouse for securities trades in the US, successfully completed a pilot program in September focused on using tokenized US Treasury bills as trading margin.

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