CFTC Exempts Crypto Software Providers From Broker Registration

The US Commodity Futures Trading Commission (CFTC) has issued a no-action letter exempting eligible crypto and prediction markets software providers from broker registration requirements.

This relief applies to developers partnering with regulated platforms under specific conditions, including maintaining zero discretion over trades, never assuming custody of users' assets, and not taking volume-based dynamic commissions.

This move builds on a precedent set in March when the CFTC granted a no-action position to Phantom Technologies, allowing it to partner with Kalshi prediction markets without needing to register as an introducing broker.

Prediction market players like Crypto.com and ProphetX have adopted similar models, expanding their reach while operating within legal provisions.