CFTC Schedules Roundtable on “Non-Intermediation” and Derivatives Trading

The Commodity Futures Trading Commission (CFTC) will hold a public roundtable on May 25, 2022, to discuss issues related to intermediation in derivatives trading and clearing. Non-intermediation and the discussion on this topic will probably address distributed ledger technology and the advent of DeFi or decentralized finance.

The CFTC states that most derivatives trading today is conducted through regulated intermediaries who perform many important functions, including providing customers with access to exchanges and clearinghouses, processing transactions, ensuring compliance with federal regulations, and guaranteeing the performance of the derivatives contract to the clearinghouse. Recently, a number of registered entities have discussed with CFTC staff proposals to offer “non-intermediated” or direct trading and clearing of margined products to retail customers.

The goal of the roundtable is said to be an information-gathering exercise receiving expert input from a variety of stakeholder groups regarding the impact non-intermediation could have in the context of CFTC-registered derivatives clearing organizations (DCOs). The roundtable is expected to include participants from DCOs, futures commission merchants (FCM), FCM customers, end-users, academics, proprietary traders, public interest groups, and others. The names of the participants have yet to be posted.

The roundtable will be held in the Conference Center at CFTC’s headquarters at Three Lafayette Centre in Washington, D.C. for participants only. The general public will have access to the roundtable by webcast on the CFTC’s website or may also listen by telephone. The event will take place on May 25, 2022, from 9:30 a.m. to 4:00 p.m ET.

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