The Commodity Futures Trading Commission (CFTC) issued a Notice of Proposed Rulemaking on 30 July 2026 targeting conflicts of interest arising from affiliations among CFTC-regulated entities. The Commission found that vertical integration across futures commission merchants (FCMs), designated contract markets (DCMs), swap execution facilities (SEFs), and derivatives clearing organisations (DCOs) has increased, including among groups active in digital asset markets.
The proposed rulemaking amends Parts 37 and 38 of CFTC regulations governing SEFs and DCMs respectively, Part 39 governing DCOs, and Commission Regulations 1.52 and 1.55. Amendments would introduce mandatory disclosure of affiliate relationships, governance requirements separating affiliated market-making from exchange and clearing functions, and enhanced financial oversight by self-regulatory organisations over FCMs affiliated with DCMs or DCOs. The CFTC adopted a principles-based approach rather than categorical prohibitions.
Digital asset exchanges, clearinghouses, and affiliated market makers operating within vertically integrated groups are the primary targets. FCMs, DCMs, SEFs, and DCOs within such structures will face new disclosure and governance obligations. Independent digital asset exchanges that use in-house or affiliated market makers will need to assess whether their ownership structures fall within the proposed affiliation definitions.
The comment period runs 60 days from Federal Register publication. No separate effective date is proposed; implementing rules will follow comment review. The proposal does not extend to spot crypto markets, which remain subject to the pending Digital Asset Market Clarity Act (H.R. 3633) in Senate negotiations. The principles-based approach is intended to preserve operational flexibility while requiring governance separation.
Licentium advises digital asset exchanges, derivatives clearinghouses, and affiliated market participants on CFTC regulatory compliance. Work we undertake includes CFTC registration and licensing advisory, affiliate relationship disclosure structuring, derivatives market structure analysis, and digital asset regulatory compliance.