$ETH
Major U.S. regulatory move
CFTC proposes classifying event contracts as swaps
Bringing them under the swap regulatory framework
Guys,
Another major U.S. regulatory proposal has landed,
targeting the recently booming event contracts.
The U.S. Commodity Futures Trading Commission (CFTC) has proposed
classifying event contracts as swaps,
subjecting them to the full set of rules for swap products.
What are event contracts?
Simply put, they’re binary prediction contracts:
you bet on whether something will or won’t happen.
For example: Will nonfarm payrolls come in above expectations?
Will BTC close above a certain price? Will the Fed raise interest rates?
If you win, you get a fixed payout.
If you lose, your stake is gone.
No need to worry about liquidations or leverage—
you’re just betting on the outcome of an event.
Recently, lots of platforms in the crypto world have been launching these products.
Once they’re classified as swaps,
they’re no longer simple prediction products;
they’re directly classified as derivatives.
Platforms and market makers will need the appropriate licenses
and have to meet the full range of compliance requirements for capital, trade reporting, segregation of customer funds, and audits.
All trading data and large traders’ positions will have to be reported from now on.
Regulation is a good thing.
This is positive for the long-term growth of the compliant sector.
Once the industry is regulated,
institutional capital will have a chance to enter the market and hedge through event contracts.
But for many smaller overseas platforms, this isn’t good news.
If small and midsize platforms focused on event contracts don’t meet licensing and qualification requirements,
they’ll probably have to delist these products or shut down.
So,
guys,
choosing the right platform for event contracts will be important from now on.
#cftc拟将事件合约纳入掉期监管
Major U.S. regulatory move
CFTC proposes classifying event contracts as swaps
Bringing them under the swap regulatory framework
Guys,
Another major U.S. regulatory proposal has landed,
targeting the recently booming event contracts.
The U.S. Commodity Futures Trading Commission (CFTC) has proposed
classifying event contracts as swaps,
subjecting them to the full set of rules for swap products.
What are event contracts?
Simply put, they’re binary prediction contracts:
you bet on whether something will or won’t happen.
For example: Will nonfarm payrolls come in above expectations?
Will BTC close above a certain price? Will the Fed raise interest rates?
If you win, you get a fixed payout.
If you lose, your stake is gone.
No need to worry about liquidations or leverage—
you’re just betting on the outcome of an event.
Recently, lots of platforms in the crypto world have been launching these products.
Once they’re classified as swaps,
they’re no longer simple prediction products;
they’re directly classified as derivatives.
Platforms and market makers will need the appropriate licenses
and have to meet the full range of compliance requirements for capital, trade reporting, segregation of customer funds, and audits.
All trading data and large traders’ positions will have to be reported from now on.
Regulation is a good thing.
This is positive for the long-term growth of the compliant sector.
Once the industry is regulated,
institutional capital will have a chance to enter the market and hedge through event contracts.
But for many smaller overseas platforms, this isn’t good news.
If small and midsize platforms focused on event contracts don’t meet licensing and qualification requirements,
they’ll probably have to delist these products or shut down.
So,
guys,
choosing the right platform for event contracts will be important from now on.
#cftc拟将事件合约纳入掉期监管