CFTC Clarifies Tokenized Investments and Blockchain Recordkeeping

The Commodity Futures Trading Commission (CFTC) has updated its crypto FAQs to provide greater clarity on using tokenized investments and blockchain technology for recordkeeping. The update addresses situations where registrants invest customer funds in tokenized versions of permitted investments, such as those already approved by CFTC rules.

CFTC Chairman Michael S. Selig said the clarification is part of the agency's ongoing efforts to provide regulatory clarity for the crypto industry. He emphasized that this update does not expand the list of assets that firms can use for customer funds and instead explains how an otherwise permitted investment can be represented through tokenization within the existing regulatory framework.

The updated FAQs also clarify how registrants can use blockchain-based systems while meeting their existing regulatory obligations for maintaining and producing records. The technology, according to the guidance, can form part of a firm's compliance infrastructure rather than being treated as incompatible with traditional recordkeeping requirements.