CFTC Eases Rules for 'Passive Software' Providers, Crypto Wallets

The US Commodity Futures Trading Commission (CFTC) has provided regulatory relief for 'passive software' providers that connect users to regulated derivatives firms and exchanges.

In a no-action position issued on Thursday, the CFTC said it would not recommend enforcement against qualifying providers or their personnel for failing to register as introducing brokers or associated persons when facilitating trading with CFTC-registered firms and exchanges.

Qualifying providers must meet conditions that limit their role in transactions, including restrictions on exercising discretion over users' orders.

The move extends a similar position granted to Phantom Technologies in March for its self-custodial crypto wallet software. The agency has also been considering requests from Phantom and the Hyperliquid Policy Center to shield non-custodial wallet providers from introducing broker requirements and clarify how existing rules apply to blockchain developers and regulated derivatives firms using onchain infrastructure.