FalconX Seeks SEC Blessing for Crypto Perpetuals as Security-Based Swaps

FalconX Bravo has submitted a proposal to the US Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC), asking them to treat cash-settled perpetuals tied to a single security or narrow-based index as security-based swaps under SEC rules.

The proposed rule change would cover perpetuals that fall outside the joint SEC-CFTC security-futures framework, including those offered through decentralized finance (DeFi) protocols. FalconX Bravo is listed on the CFTC's registered swap dealer roster and describes its business as focused on digital assets and market participants.

The filing excludes Bitcoin perpetuals and general crypto perpetuals from the proposed rule change. A qualifying contract that is listed as a security futures product on an authorized market would remain in the joint regime, with accompanying safeguards such as listing requirements, clearing, margin, position limits, surveillance, and trading halts.