CFTC Approves Swap and Derivatives Rules that would require clearing member funds be segregated from the DCO’s own funds and held in a depository that acknowledges, in writing, that the funds belong to clearing members, not the DCO.
CFTC Approves Two Proposals and a DCO Application in conjunction with its December 13th meeting.
CFTC Approves Two Proposals and a DCO Application in conjunction with itsDecember 13th meeting where they considered:
Proposed Rule: Operational Resilience Framework for Futures Commission Merchants, Swap Dealers, and Major Swap Participants
Proposed Rule: Capital and Financial Reporting Requirements for Swap Dealers and Major Swap Participants
Proposed Rule: Protection of Clearing Member Funds Held by Derivatives Clearing Organizations
Amended Application of Bitnomial Clearinghouse, LLC for Registration as a Derivatives Clearing Organization
Proposed Rule: Amendments to Swap Data Recordkeeping and Reporting Requirements
CFTC approved a rule proposing regulations to provide protections for clearing member funds and assets held by a Derivatives Clearing Organization (DCO).
The rule would require, among other things, that clearing member funds be segregated from the DCO’s own funds and held in a depository that acknowledges, in writing, that the funds belong to clearing members, not the DCO. In addition, the Commission is proposing rules that would enable DCOs to hold customer and clearing member funds at certain foreign central banks subject to certain requirements.
CFTC is also proposing to require DCOs to conduct a daily calculation and reconciliation of the amount of funds owed to customers and clearing members and the amount actually held for customers and clearing members
OPEN for comment: the comment period will be open for 60 days after publication on CFTC.gov, with a closing date of February 16, 2024.
Comments may be submitted electronically through the CFTC Comments online process.
CFTC unanimously approved a rule proposal requiring that futures commission merchants, swap dealers, and major swap participants establish, document, implement, and maintain an Operational Resilience Framework reasonably designed to identify, monitor, manage, and assess risks relating to information and technology security, third-party relationships, and emergencies or other significant disruptions to normal business operations.
The framework would include three components – an information and technology security program, a third-party relationship program, and a business continuity and disaster recovery plan – supported by broad requirements relating to governance, training, testing, and recordkeeping.
The proposed rule would also require certain notifications to the Commission and customers or counterparties.
The Commission is further proposing guidance relating to the management of risks stemming from third-party relationships.
OPEN for comment: the comment period will be open for 75 days after publication on CFTC.gov, with a closing date of March 2, 2024.
Comments may be submitted electronically through the CFTC Comments online process.
CFTC approved an order granting Bitnomial Clearinghouse, LLC (Bitnomial) registration as a DCO under Section 5b of the Commodity Exchange Act.
Subject to the terms and conditions of the order, Bitnomial is authorized to provide clearing services for futures and options on futures traded on a designated contract market (DCM).
Bitnomial’s parent company, Bitnomial Exchange, LLC, is registered with the CFTC as a DCM.
CFTC proposed regulations to safeguard clearing member funds and assets held by a Derivatives Clearing Organization (DCO). This rule would segregate clearing member funds from the DCO’s own funds and ensure they are held in a depository that acknowledges the funds belong to clearing members.
CFTC is also proposing rules that would allow DCOs to hold customer and clearing member funds at certain foreign central banks, subject to specific requirements.
CFTC is proposing a requirement for DCOs to perform daily calculations and reconciliations of the amounts owed to and actually held for customers and clearing members.
The comment period for this proposal closes on February 16, 2024.
A new rule was approved by the CFTC requiring futures commission merchants, swap dealers, and major swap participants to establish, document, implement, and maintain an Operational Resilience Framework.
This framework is aimed at managing risks related to information and technology security, third-party relationships, and emergencies or significant disruptions.
The Operational Resilience Framework will comprise three key components: an information and technology security program, a third-party relationship program, and a business continuity and disaster recovery plan. This framework will be supported by governance, training, testing, and recordkeeping requirements.
The proposed rule includes a requirement for certain notifications to the Commission and to customers or counterparties, as well as guidance for managing risks from third-party relationships.
The comment period for this rule closes on March 2, 2024.
Bitnomial Clearinghouse, LLC (Bitnomial) received approval from the CFTC for registration as a DCO under Section 5b of the Commodity Exchange Act.
Bitnomial is authorized to provide clearing services for futures and options on futures traded on a designated contract market (DCM).
