The Commodity Futures Trading Commission offered conditional broker-registration relief to qualifying passive software providers that connect users with regulated derivatives markets. The Market Participants Division announced the no-action position on September 17. Staff will not recommend enforcement against qualifying providers or relevant personnel for failing to register as introducing brokers or associated persons.
The relief applies only when providers meet 10 requirements and stay within the activities covered by Staff Letter 26-25. Providers also cannot rely on the letter beyond the conduct it covers.
The division’s position concerns enforcement recommendations for introducing-broker and associated-person registration, rather than other obligations that could apply. The relief therefore remains narrow.
The framework applies to software that lets users trade through registered futures commission merchants, introducing brokers, and designated contract markets. Users must remain customers or direct members of the regulated firm that handles their transactions. They do not become customers of the software provider.
This distinction places the software provider outside several functions associated with a traditional intermediary. The position covers passive tools rather than businesses that take custody, execute trades, or control customer accounts. The CFTC did not grant a broad exemption to all software companies.
The agency also made clear that crypto developers do not receive blanket protection. Wallet developers and other digital-asset software companies may qualify when their products connect users with eligible derivatives markets. Their status still depends on the letter’s requirements and the services they provide.
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Staff Letter 26-25 follows similar treatment under Staff Letter 26-09. The earlier matter involved software that gave users access to regulated derivatives while registered firms kept responsibility for trade execution, customer accounts, and asset control.
The new position does not change the Commodity Exchange Act. Under the CFTC’s staff-letter process, a no-action letter states that the issuing division will not recommend enforcement for specified conduct. It does not operate like a Commission rule or formal statutory exemption.
Industry groups welcomed the move as added regulatory clarity. Digital Chamber CEO Cody Carbone said the action removes uncertainty for software providers that build interfaces connecting users with registered FCMs and DCMs.
Blockchain Association CEO Summer Mersinger said the division took a functional approach by examining what a provider actually does.Under the CFTC framework, the answer depends on whether providers remain within the letter’s stated conditions and avoid taking on regulated intermediary functions.
The CFTC action came on the same day the Securities and Exchange Commission announced an ‘Innovation Exemption’ for tokenized US stocks. Both developments followed the Senate’s failed vote to advance the Digital Asset Market Clarity Act.
The proposed legislation would have created a federal market-structure framework for digital assets and clarified responsibilities between the CFTC and SEC. After the Senate vote, both agencies continued pursuing regulatory measures within their existing authorities.
CFTC Chair Michael Selig had directed staff in August to explore crypto market-structure rules if Congress did not pass the Clarity Act. The areas included crypto exchanges, leveraged trading, and on-chain finance protocols. SEC Chair Paul Atkins also said in July that the SEC was prepared to write crypto rules if the legislation stalled.
Coinbase Vice Chairman Ryan VanGrack described the SEC and CFTC actions as a sharp change after years of regulatory standstill. He pointed to the SEC Innovation Exemption and the CFTC no-action relief as two meaningful developments arriving within hours.
The CFTC’s no-action position gives qualifying passive software providers conditional protection from broker-registration enforcement when they meet Staff Letter 26-25’s requirements. The action remains limited to covered activities and does not change the Commodity Exchange Act. Crypto developers may qualify only when their tools fit the framework.