Overview
On September 23, 2025, the CFTC launched an initiative for the use of tokenized collateral including stablecoins in derivatives markets.[i] This initiative followed the CFTC’s Crypto CEO Forum held in February, during which industry leading firms (e.g. Coinbase, Crypto.com, Circle, Moonpay, and Ripple) gathered to discuss the launch of the CFTC’s digital asset markets pilot program for tokenized non-cash collateral such as stablecoins.[ii] Following her announcement of the CFTC Crypto Sprint,[iii] a workstream to start implementation of the recommendations in the President’s Working Group on Digital Asset Markets report,[iv]this announcement is an important step toward recognizing digital assets as part of U.S. financial market infrastructure.
Call to Action
The CFTC invites all interested stakeholders to submit feedback and suggestions on the use of tokenized collateral including stablecoins in derivatives markets. Subject areas include the CFTC’s GMAC 2024 recommendation; CFTC observer status on industry efforts; potential digital asset markets pilot programs; amendments to CFTC regulations in connection with the President’s Working Group report recommendations regarding collateral management, and other related issues.
Members may submit feedback by October 20, 2025. (Update: The deadline has been extended to November 28, 2025.)
Background
In November 2024, the CFTC’s Global Markets Advisory Committee, sponsored by Commissioner Pham, advanced a recommendation to expand the use of non-cash collateral through the use of distributed ledger technology.[v] The recommendation recognized that while the CEA permits use of non-cash collateral to satisfy regulatory margin requirements for cleared and non-cleared derivatives, operational challenges persist. Such challenges include friction from involvement of multiple intermediaries, limits on secondary transfers, and a lack of 24/7/365 capabilities.
Blockchain can solve these challenges. Distributed ledger technology can be used for internal recordkeeping and tokenized assets can be transferred and recorded immediately. Examples of assets that can be tokenized and serve as collateral include debt securities, government securities, corporate debt, money market funds, and gold. Tokenizing collateral is expected to drastically reduce the cost and complexity of the current system.
Ultimately, GMAC made three recommendations:
Recommendation 1: Where DLT-based infrastructure is used solely as part of a financial institution’s internal books and records, then a CFTC registrant should be able to rely on its normal processes to assess information security and other relevant operational risks, whether those risks arise from the registrant’s own use of DLT-based infrastructure for its internal books and records or from the use of such infrastructure by a service provider, such as a custodian, for the service provider’s internal books and records.
Recommendation 2: Where a CFTC registrant looks to accept eligible non-cash collateral in tokenized form, it should be able to satisfy relevant requirements by applying its existing policies, procedures, and practices in the following areas: legal enforceability; segregation and custody arrangements; credit and custodial risk; and operational risk.
Recommendation 3: Because use of DLT for these purposes need not affect the character of the relevant asset, and because registrants already have extensive policies, procedures, practices, and processes to address use of new technologies and infrastructures, no new rules or guidance should be necessary in order to permit such use.
Importantly, implementing the recommendations would not require regulatory action or changes to existing collateral eligibility rules. This is because non-cash collateral is permitted under the CEA when assets are liquid, hold, value, and lack correlation to counterparty or portfolio risk.
Conclusion
This announcement indicates the CFTC will likely permit the use of stablecoins and tokenized assets to be used as non-cash collateral. Should you wish to further discuss this development or submit feedback to the CFTC, our attorneys are available to assist you.
This article is for informational purposes only and does not constitute legal advice. For specific advice regarding your situation, please consult qualified counsel.
Bull Blockchain Law LLP is a boutique law firm dedicated to advising clients at the intersection of digital assets, fintech, and financial regulation. If you have questions about how these developments may impact your business, please contact any member of our team directly or schedule a consultation.
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[i] Commodity Futures Trading Commission, Acting Chairman Pham Launches Tokenized Collateral and Stablecoins Initiative, Release No. 9130-25 (Sept. 23, 2025), https://www.cftc.gov/PressRoom/PressReleases/9130-25
[ii] Commodity Futures Trading Commission, CFTC Announces Crypto CEO Forum to Launch Digital Asset Markets Pilot, Release No. 9049-25 (Feb. 7, 2025), https://www.cftc.gov/PressRoom/PressReleases/9049-25
[iii] Commodity Futures Trading Commission, Acting Chairman Pham Announces CFTC Crypto Sprint, Release No. 9104-25 (Aug. 1, 2025), https://www.cftc.gov/PressRoom/PressReleases/9104-25
[iv] The White House, Strengthening American Leadership in Digital Financial Technology (The White House – Crypto) (visited Oct. 1, 2025), https://www.whitehouse.gov/crypto/
[v] Commodity Futures Trading Commission, CFTC’s Global Markets Advisory Committee Advances Recommendation on Tokenized Non-Cash Collateral, Release No. 9009-24 (Nov. 21, 2024), https://www.cftc.gov/PressRoom/PressReleases/9009-24