Crypto and TradFi Chiefs Join CFTC Council

The council brings together top executives from leading crypto exchanges, prediction markets and major traditional finance institutions to help shape the future structure of regulated derivatives markets. At the same time, the agency’s updated guidance and pilot program are a major shift toward integrating Bitcoin, Ethereum, USDC and even tokenized real-world assets into established market infrastructure. With stricter reporting rules, clearer guardrails and the withdrawal of outdated restrictions like Staff Advisory 20-34, the CFTC is positioning itself as a more collaborative and forward-looking regulator.

Top Executives Join CFTC

The US Commodity Futures Trading Commission deepened its engagement with the crypto and blockchain sector after adding a mix of digital-asset executives and traditional finance leaders to its newly formed CEO Innovation Council. The council was announced on Wednesday, and it is designed to guide how the agency approaches market-structure issues in derivatives markets, particularly as tokenization, 24/7 trading, blockchain settlement, and crypto-collateralized products move closer to mainstream adoption.

Some of the participants include chief executives from leading crypto exchanges and prediction markets like Polymarket, Kalshi, Kraken, Gemini, Bitnomial, Crypto.com and Bullish. Their inclusion suggests that the CFTC wants direct input from firms that are actively building in the crypto derivatives and on-chain prediction market space. They will sit alongside senior leaders from legacy market institutions including CME Group, Cboe Global Markets, Nasdaq, Intercontinental Exchange and the London Stock Exchange Group.

Participants in the CFTC CEO Innovation Council (Source: CFTC)

Acting CFTC Chair Caroline Pham said the council builds on the success of earlier initiatives including the CFTC Crypto CEO Forum and the SEC-CFTC Joint Roundtable. The new body is specifically tasked with exploring market-structure developments that could shape the next generation of regulated derivatives markets. Its discussions will revolve around how crypto assets, perpetual contracts, tokenized instruments and prediction markets can fit into the supervisory frameworks used for established financial products.

The creation of the Innovation Council comes just days after Pham unveiled a pilot program allowing CFTC-registered futures commission merchants to accept Bitcoin, Ethereum and Circle’s USDC stablecoin as margin collateral. Together, these initiatives prove that the CFTC is taking on a much more collaborative and forward-leaning posture, which contrasts with years of uncertainty surrounding crypto oversight at the US Securities and Exchange Commission.

Earlier in the year, the CFTC launched its Crypto CEO Forum with leaders from Coinbase, Circle and Ripple. Pham also repeatedly pointed out that regulators must move quickly to support American competitiveness in digital finance.

Crypto Collateral Pilot Another Big Shift at the CFTC

The CFTC also recently took a major step toward integrating digital assets into regulated derivatives markets by issuing updated guidance for tokenized collateral and launching a pilot program that allows certain cryptocurrencies to be used as margin. The move is one of the strongest signals yet that US market regulators are preparing for a future in which blockchain-based assets play a meaningful role in traditional financial infrastructure.

The pilot program was announced by acting CFTC Chair Caroline Pham on Monday, and it will allow futures commission merchants to accept Bitcoin, Ethereum and Circle’s USDC stablecoin as collateral from customers trading futures. Collateral in derivatives markets serves as a financial safeguard to ensure traders can cover potential losses, and the inclusion of digital assets is a big shift from long-standing restrictions. 

Announcement from the CFTC

Pham said the program sets “clear guardrails” that are designed to protect customer assets through strict reporting standards, including weekly disclosures on holdings and any operational issues related to crypto collateral.

The pilot is supported by updated guidance from three CFTC divisions, which outlines how tokenized assets — including tokenized U.S. Treasurys and money market funds — may be used in futures and swaps trading. The guidance addresses legal enforceability, segregation requirements and control mechanisms, offering a clearer regulatory pathway for institutions looking to bring real-world assets on-chain. Pham explained that the new framework opens the door for more types of digital assets to be accepted as collateral in the future.

The agency also withdrew Staff Advisory 20-34, which sharply restricted the ability of futures commission merchants to accept crypto as customer collateral. The advisory was deemed outdated in light of recent developments, including changes introduced by the GENIUS Act. The CFTC also issued a no-action position on certain requirements tied to the use and custody of payment stablecoins.

The decision attracted a lot of support from across the crypto industry. StarkWare general counsel Katherine Kirkpatrick Bos called the move “massive,” due to benefits like atomic settlement, automation and capital efficiency. Coinbase chief legal officer Paul Grewal praised the withdrawal of Staff Advisory 20-34, and argued that it stifled innovation. 

Salman Banaei of the Plume Network said the pilot is another step toward adopting on-chain infrastructure for settling derivatives and swaps, one of the largest markets in the world.