CFTC Policy Updates

What Changed

• - The CFTC Portal now supports consolidated product self‑certification submissions, enabling exchanges to file a single set of certification documents that apply to multiple closely related contracts...
• Exchanges are no longer required to upload multiple identical copies of supporting product certification documents when listing several closely related contracts; one shared documentation set can be...
• The enhancement is framed as an administrative/technical change to the filing process; it does not alter substantive legal standards for product self‑certification under the Commodity Exchange Act or...
• The CFTC has issued updated submission instructions on the Portal site specifying how to use the new consolidated filing functionality, including formatting and process guidance.
• Dedicated technical and non‑technical CFTC contacts have been identified (Howard Rosen for system use; Chris Goodman for product submission process questions), signaling that the Commission expects...

Suggested Considerations

• Review and obtain the updated submission instructions on the CFTC Portal and ensure legal, compliance, and operations staff understand the consolidated filing functionality and any new formatting or data‑entry requirements.
• Update internal product approval and submission procedures (including Part 40 playbooks and checklists) to reflect the ability to file a single set of documents for multiple closely related contracts, and to define when consolidation is appropriate.
• Revise internal documentation templates (e.g., product term sheets, legal analyses, core principle compliance memos, risk assessments) so that they can explicitly support multiple closely related contracts in a single package where relevant.
• Adjust governance workflows (approvals, sign‑offs, and quality checks) so that:
• Each contract included in a consolidated submission is clearly identified and traceable, and

Key Dates

References

• [1] quickreads.ext.katten.com/post/102jlxr/the-cftc-amends-pa...
• [2] cftc.gov/PressRoom/SpeechesTestimony/romerostatement072623c
• [3] cftc.gov/IndustryOversight/ContractsProducts/ListingProce...
• [4] cftc.gov/PressRoom/SpeechesTestimony/mersingerstatement09...
• [5] law.cornell.edu/cfr/text/17/40.6
• [6] federalregister.gov/documents/2024/11/07/2024-24388/provi...
• [7] fia.org/fia/articles/cftc-examines-self-certification-pro...
• [8] cftc.gov/IndustryOversight/ContractsProducts/index.htm

What Changed

• - The CFTC formally recognizes that perpetual contracts may be listed as “futures contracts” by DCMs, as evidenced by an order permitting listing of a perpetual contract referencing the spot price of...
• The Commission states that perpetual contracts have “unique characteristics” that vary by underlying asset, and therefore they will not be treated as a homogeneous product category for listing...
• For perpetual contracts referencing asset classes not covered by the contemporaneous bitcoin perpetual order, the Commission indicates that the appropriate path is a case‑by‑case review under CFTC...
• The policy statement signals that DCMs should expect closer CFTC scrutiny of perpetual contract design, including settlement mechanisms and underlying market integrity, before new perpetuals (beyond...
• The statement confirms that it is a policy statement rather than a binding rule, but it effectively sets Commission expectations for how DCMs must approach the listing of perpetual contracts going...

Suggested Considerations

• DCMs intending to list new perpetual contracts must route proposed products that are not clearly covered by the existing bitcoin perpetual order through a Commission Regulation 40.3 case‑by‑case review process, and should build internal product‑approval workflows accordingly.
• DCMs must enhance their surveillance, market‑integrity, and risk‑management frameworks for perpetual contracts, including monitoring of the referenced spot market, funding‑rate or cash‑flow mechanisms, and potential manipulation vectors stemming from the underlying asset.
• FCMs and clearing members should identify client exposure to perpetual futures, review margin models and risk limits, and ensure that risk disclosures, product descriptions, and account‑opening documentation accurately reflect the regulatory status and unique risks of perpetual futures.
• Compliance teams at DCMs and intermediaries should update policies and procedures for new product approval, explicitly flagging perpetual contracts as requiring heightened CFTC engagement and governance review before listing.
• Legal and regulatory affairs teams should brief senior management and boards on the policy statement, emphasizing that future perpetual contracts on non‑bitcoin or non‑covered asset classes carry additional regulatory scrutiny and potential delays due to the required case‑by‑case review.

Key Dates

References

• [1] cadwalader.com/resources/clients-friends-memos/cftcs-incr...
• [2] cftc.gov/PressRoom/PressReleases
• [3] cftc.gov/PressRoom/index.htm
• [4] cftc.gov
• [5] cftc.gov/PressRoom/PressReleases?page=4
• [6] cftc.gov/PressRoom/SpeechesTestimony/giancarlostatement07...
• [7] cftc.gov/PressRoom/PressReleases/8188-20
• [8] cftc.gov/PressRoom/SpeechesTestimony/opabehnam35