The Commodity Futures Trading Commission's Market Participants Division issued a no-action letter Thursday allowing passive software providers to connect users to regulated derivatives markets without registering as introducing brokers.
The letter covers software that enables users to view market data, access product offerings, check position information, and submit orders for CFTC-regulated derivatives—including event contracts and perpetual contracts—directly to registered entities. The relief extends earlier guidance granted in March to Phantom Technologies, a self-custody wallet that was cleared to facilitate this same access.
Under the letter's terms, CFTC staff will not recommend enforcement against passive software providers for failing to register as introducing brokers or associated persons, provided they remain within covered activities and meet specified conditions. These conditions include user disclosures about relationships with registered entities, conflicts of interest, and fees; marketing policies; recordkeeping requirements; insolvency or bankruptcy notices; and a filing agreeing to the terms.
Industry groups characterized the guidance as removing regulatory uncertainty for developers building derivatives market interfaces. The Digital Chamber and Blockchain Association both praised the CFTC's functional approach to regulation, which evaluates what technology providers actually do rather than treating software as a traditional financial intermediary.
The CFTC action came the same day the SEC announced an "Innovation Exemption" for tokenized U.S. stocks. Both moves followed the Senate's failed vote on the Digital Asset Market Clarity Act, which would have established a federal framework for digital assets and clarified roles between the CFTC and SEC.
CFTC Chair Michael Selig directed staff in August to explore market-structure rules for crypto if Congress did not pass the Clarity Act. SEC Chair Paul Atkins previously stated the SEC was prepared to write its own crypto rules if legislation stalled.
