Crypto Funds Face Headaches Over Form PF Reporting Requirements

The clash between traditional financial reporting and the 24/7 nature of cryptocurrency markets is causing headaches for crypto funds. Form PF, a regulatory filing requirement, assumes business hours and end-of-day prices, which doesn't align with the constant trading and price fluctuations in cryptocurrencies.

Crypto funds have developed workarounds to deal with this issue, such as fixing a daily NAV time (usually 00:00 UTC), using multi-venue pricing, and accounting for staking and DeFi activities. However, these patches don't make Form PF's current reporting requirements easy when an event lands on a Saturday.

The SEC is considering amendments to Form PF, while the CFTC has asked for comments on 24/7 futures and perpetual contracts. The number of affected managers is significant, with over 300 crypto funds launched since 2020.