The U.S. Commodity Futures Trading Commission has widened a form of temporary regulatory relief for software developers whose products connect users to regulated derivatives markets. In a Sept. 17 staff action, the agency’s Market Participants Division said certain providers of “passive software” may market derivatives products, transmit customer orders to registered counterparties, and collect transaction-based fees without registering as introducing brokers.
The step expands a framework first granted to Phantom Technologies in March and applies it to a broader set of similarly situated software providers. The relief covers tools such as wallets, browser extensions, and websites, but only under conditions that keep the software in a limited, non-custodial role.
What the relief permits
Under the CFTC staff position, qualifying software can display market data and available derivatives contracts, help users find those products, and pass orders through to registered futures commission merchants, introducing brokers, or designated contract markets. It can also promote those products and receive transaction-based compensation tied to trading activity.
That creates room for a self-custodial wallet or similar interface to serve as the front end for access to regulated derivatives while the actual customer relationship remains with the registered market participant. In practice, the CFTC is distinguishing between software that facilitates access and firms that act as regulated intermediaries.
Limits on wallets, websites, and extensions
The no-action relief comes with clear boundaries. Providers cannot custody customer funds or the assets backing a derivatives position, cannot decide where customer orders are routed, and cannot provide trading advice or explicit buy-or-sell signals.
The software also cannot direct users to unregistered venues. Customers must onboard directly with registered market participants, and providers remain subject to disclosure, recordkeeping, and marketing conditions described in the staff relief. The permission is therefore tied specifically to software that connects users with CFTC-registered venues and intermediaries, rather than opening a general exemption for all crypto trading interfaces.
From Phantom’s letter to broader coverage
The broader relief builds on Phantom Technologies’ earlier no-action letter from March, identified as Staff Letter 26-09. The Sept. 17 expansion, issued as Staff Letter 26-25, extends the same basic concept beyond a single company to others whose software operates in a similar passive manner.
That change matters because it gives more developers a clearer basis to offer derivatives-related features without immediately facing introducing-broker registration, provided they remain within the limits laid out by staff. The source article framed this as a potentially meaningful opening for crypto wallet developers that want to add regulated derivatives access alongside existing digital asset functions.
Temporary status and next step
The relief is not a formal rule change, and it does not amend the Commodity Exchange Act. It is a no-action position from CFTC staff, meaning it reflects how staff intend to treat specified conduct under stated conditions rather than creating a permanent legal safe harbor.
According to the staff action, the relief will remain in effect until the Commission adopts formal rulemaking or guidance on how introducing-broker registration should apply to software providers. Until then, developers have a wider but still conditional path to offer passive derivatives functionality, while the longer-term regulatory framework remains unsettled.
Source: news.bitcoin.com