The Commodity Futures Trading Commission (CFTC) has updated its FAQs regarding tokenized collateral and digital asset margin collateral frameworks. Key points include:
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Acceptable Assets: While client funds of Futures Commission Merchants (FCMs) and clearinghouses cannot be invested in stablecoins, certain tokenized money market funds (MMFs) and Treasuries are now acceptable.
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Hurdles for Tokenized Assets: For these assets to qualify, they must be held by a permitted depository, potentially including newly authorized OCC national trust companies. Additionally, the entity holding tokenized government MMFs must provide an acknowledgment letter confirming the segregation of client assets.
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Clarifications on Swaps: Uncleared swaps have stricter rules, allowing only tokenized versions of eligible assets as collateral. The updated FAQs confirm that tokenized MMFs can be included, following recent amendments to accept MMFs that engage in repo and securities lending.
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