CFTC Seeks Information on Rules that "Unduly Impede Fintech Firms"

The CFTC asked market participants to identify rules, guidance, orders, and no-action letters that may unduly impede fintech firms from working in the derivatives markets.

In its Request for Information published in the Federal Register, the CFTC followed up on an Executive Order ("EO") directing federal financial regulators to make their frameworks friendlier to financial-technology firms. The EO defined a "fintech firm" as any non-bank company that uses or develops technology to offer or support financial products and services, from payments and lending to digital-asset and blockchain-based services (see prior coverage). The EO directed each regulator to review its rules within 90 days and to take steps to encourage innovation within 180 days.

The CFTC said its goals are to identify requirements that block fintech firms from partnering with its registrants (such as futures commission merchants, swap dealers, designated contract markets, and clearinghouses) and processes that could be streamlined for firms seeking registration. The CFTC also asked market participants to weigh in on whether the agency's registration categories fit new business models, including decentralized finance protocols, and whether any registration category is too broadly defined.