CFTC approves Cboe Clear Digital to clear margined digital asset futures

The Commodity Futures Trading Commission on Monday said it had approved an amended order of registration for Cboe Clear Digital to clear additional products as a derivatives clearing organization.

The amended order permits Cboe Clear to "provide clearing services for digital asset futures on a margined basis for futures commission merchants, in addition to the fully collateralized futures and fully collateralized swaps previously authorized," the U.S. regulator said in a statement.

Cboe Digital Exchange, Cboe Clear's parent company, is registered as a designated contract market with the CFTC. The measure authorizes Cboe to expand its clearing of futures contracts on crypto assets "while staying within the traditional U.S. futures intermediated market structure," CFTC Commissioner Christy Goldsmith Romero said in a separate statement.

"The Order is accompanied by prudent risk-mitigation measures implemented by Cboe," Romero said, adding that the application had stood in "stark contrast" to one from collapsed crypto exchange FTX "for a bespoke disintermediated direct-to customer market structure."

"I have been vocal about the benefits of bringing appropriate crypto activities into the regulated space in order to protect customers, but in a way that supports oversight, accountability, transparency, and risk management," Romero said. "Too often in recent years, crypto firms have sought to take a business model or market structure that exists in an unregulated environment and port it over to the regulated environment."

"Cboe has not done that, instead operating within the parameters of the traditional futures market structure and regulatory framework," Romero continued. "It has constructively engaged with the staff and my office to address concerns related to risk, and implement risk-mitigating measures."