On 27 September 2024, the United States’ Commodity Futures Trading Commission (US CFTC)’s Division of Clearing and Risk announced a public roundtable discussion to explore new and emerging issues in the clearing industry which will convene on 16 October 2024. This event will run from 9:00 a.m. to 1:00 p.m. at the US CFTC’s headquarters in Washington, D.C., and will bring together a broad spectrum of participants, including representatives from derivatives clearing organizations, futures commission merchants (FCMs), FCM customers, end-users, custodians, proprietary traders, public interest groups, and state regulators. The goal of this roundtable is to gather expert insights and perspectives on the evolving landscape of clearing, with a particular focus on digital assets, margin requirements, and new models for clearing.
Among the key topics to be addressed are the custody and delivery of digital assets, full collateralization, the challenges of 24/7 trading, non-intermediated clearing with margin, and potential conflicts of interest within vertically-integrated entities.
The roundtable will be accessible to the public, with seating available on a first-come, first-served basis. For those unable to attend in person, the event will be live-streamed on the US CFTC’s website and YouTube channel, and available via listen-only audio feed through the provided dial-in numbers. The CFTC is also accepting public comments on the issues discussed, with a submission deadline of 23 October 2024.
Digital assets are primarily built on blockchain technology, which allows for decentralized ownership, transparent transaction records, and the secure transfer of value. As the adoption of digital assets has expanded, they have presented both opportunities and challenges for regulators, particularly around issues such as custody, market integrity, and investor protection. Their unique characteristics, such as 24/7 trading and the absence of traditional intermediaries, have led to the need for updated regulatory frameworks to manage risks related to liquidity, margin requirements, and operational security.
The US CFTC’s aims to ensure that the clearing industry adapts to the rapid technological advancements and new financial instruments transforming the derivatives markets. Public input from this event will help the agency address potential regulatory challenges.
(Source: https://www.cftc.gov/PressRoom/PressReleases/8985-24)
