U.S. CFTC Acting Chair Officially Confirms "Using BTC as Collateral in the Derivatives Market"

JH Kim

Summary

The U.S. CFTC said it has formalized allowing digital assets such as Bitcoin (BTC), Ethereum (ETH), USDC to be used as collateral in the derivatives market.
During the initial three months, only registered futures commission merchants (FCMs) may accept the above digital assets as customer margin collateral, and strict conditions such as weekly reporting obligations will apply.
Acting Chair Pham said the measure will expand the use of tokenized collateral for digital assets, provide regulatory clarity for tokenization of real-world assets, and improve existing regulatory requirements.

The U.S. Commodity Futures Trading Commission (CFTC) has formalized a path to utilize Bitcoin (BTC) and other assets as collateral in the regulated derivatives market.

On the 10th (local time), Caroline Pham (C.F. Pham), Acting Chair of the CFTC, appeared on CNBC's 'Squawk Box' and said bitcoin will be able to be used as collateral in the derivatives market.

Earlier, the CFTC announced in a press release the launch of a pilot program to use digital assets as 'tokenized collateral' in the derivatives market. The CFTC said the program addresses ways to use certain digital assets, including Bitcoin, Ethereum (ETH), and USDC, as collateral, and provided related guidance.

According to the CFTC, the measure focuses on establishing 'guardrails' to protect customer assets in the process of using tokenized assets as collateral in futures and swap transactions, and on strengthening monitoring and reporting systems. In particular, for the initial three months it limited the digital assets that registered futures commission merchants (FCMs) may accept as customer margin collateral to Bitcoin, Ethereum, and USDC, and included conditions such as weekly reporting obligations.

Acting Chair Pham said the pilot will also provide regulatory clarity for tokenized collateral of real-world assets (RWA) such as U.S. Treasuries and money market funds, and will repeal outdated requirements under the implementation of the 'GENIUS Act'.