CFTC grants developers relief from broker registration

The Commodity Futures Trading Commission announced on Thursday that it would not recommend enforcement action against software developers who remain unregistered as introducing brokers, provided specific conditions are met, according to The Block.

This guidance extends a previous no-action letter granted to crypto wallet provider Phantom, which had wanted to incorporate derivatives trading features into its platform. The new stance applies to developers serving as intermediaries for designated contract markets, contingent upon their provision of specific disclosures and implementation of mandated policies.

Patrick Wilson, General Counsel at the Solana Policy Institute, characterized the change as a major development. “This is a significant step forward because it takes what was previously Phantom-specific relief and turns it into a framework that other software providers can build around,” Wilson said.

A footnote within the agency’s document suggested the exemption could reach beyond “crypto asset related software.” Industry sources noted that no-action letters remain subject to reversal by future commissions. One source commented, “I do think the more people who adopt this and the more people who operate within this framework, the stickier it becomes, the harder it is to yank that rug in the future.”