CFTC expands regulatory relief for passive trading software providers

The US Commodity Futures Trading Commission (CFTC) has expanded regulatory relief for passive trading software providers, which could make it easier for crypto wallets and other apps to offer access to regulated derivatives and prediction markets without registering as introducing brokers. This move, made possible by a no-action position issued by the CFTC's Market Participants Division, could potentially benefit platforms such as crypto wallets and apps that facilitate trading with CFTC-registered firms and exchanges.

To qualify for this expanded relief, providers must adhere to specific conditions that limit their role in transactions, including restrictions on exercising discretion over users' orders.

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