The CFTC issued Press Release No. 9274-26 announcing a Notice of Proposed Rulemaking titled 'Affiliations Among Certain CFTC-Regulated Entities', published for public comment in 2026. The NPRM is at the proposed-rule stage and has not been finalized. Chairman Michael S. Selig described the proposal as establishing 'principles-based regulations for vertically integrated market structures.'
The NPRM proposes amendments to CFTC regulations governing designated contract markets (DCMs), derivatives clearing organizations (DCOs), swap execution facilities (SEFs), and futures commission merchants (FCMs) under the Commodity Exchange Act. The proposed rules would require covered affiliates to: disclose affiliate relationships in registration filings and annual reports; establish written governance policies to identify, disclose, and mitigate conflicts of interest arising from affiliate arrangements; and restrict categories of inter-affiliate transactions that may disadvantage customers or disrupt market integrity. The CFTC cited rulemaking authority under Commodity Exchange Act sections 5, 5b, 5h, and 4d.
Vertically integrated crypto exchanges, clearing entities, and trading firms holding multiple CFTC registrations will face new governance, disclosure, and transaction-restriction obligations if the rule is finalized. Market makers affiliated with DCMs must assess whether their structures trigger the proposed conflict-mitigation duties. Firms organized as DCO-DCM-FCM groups, a model common in digital asset markets following recent consolidation, are the primary targets of the proposed rules. Compliance functions will need to map inter-affiliate relationships and establish conflict-identification procedures.
The NPRM applies a principles-based approach designed to accommodate novel market structures, indicating the CFTC does not intend to prohibit vertical integration as such. The comment period provides market participants an opportunity to propose safe harbors for common and commercially necessary inter-affiliate arrangements. No effective date has been announced pending finalization. The scope of the final rule will depend on public comments received.
Licentium advises on CFTC regulatory matters and digital asset compliance and may assist directly or through its partner network. Vertically integrated crypto and derivatives firms, FCMs, DCOs, DCMs, and affiliated market makers are welcome to contact us. Work we undertake includes CFTC registration analysis, digital asset regulatory compliance, conflicts-of-interest governance, exchange and clearing organization compliance reviews, and US commodity law advisory.