CFTC Launches Pilot Program Allowing Bitcoin, Ether and Stablecoins as Collateral

The Commodity Futures Trading Commission (CFTC) has introduced a new pilot program that allows select digital assets — including bitcoin (BTC), ether (ETH), and payment stablecoins such as USD Coin (USDC) — to be used as collateral in U.S. derivatives markets. Announced by Acting Chair Caroline Pham, the initiative aims to modernize collateral practices and provide clearer regulatory guidelines for tokenized assets, including tokenized U.S. Treasuries and other real-world assets.

According to Pham, the program establishes stricter safeguards to protect customer funds, improve transparency and enhance the CFTC’s oversight of digital asset usage in margin accounts. This marks a significant step forward after years of uncertainty around how crypto could legally function as collateral within regulated derivatives markets.

Under the pilot, only futures commission merchants (FCMs) that meet specific criteria can accept BTC, ETH, and approved stablecoins as margin collateral for futures and swaps. These firms must follow rigorous custody, operational risk management, and reporting standards. For the first 90 days, participating FCMs are required to submit weekly disclosures detailing their digital asset holdings and must immediately notify the CFTC of any problems or irregularities.

In practical terms, this program enables a registered firm to accept bitcoin as collateral for a leveraged commodity swap while regulators closely monitor custody arrangements and technology risks. The CFTC also issued a no-action letter granting limited permission for FCMs to hold approved digital assets in segregated customer accounts, provided strong risk controls are in place. At the same time, the agency withdrew outdated 2020 guidance that had restricted crypto collateral, noting that the landscape has changed significantly following the passage of the GENIUS Act, which modernized U.S. digital asset regulations.

Industry leaders welcomed the development. Coinbase Chief Legal Officer Paul Grewal said the decision reflects exactly what Congress intended when it passed the GENIUS Act. The CFTC reiterated that while it remains technology-neutral, tokenized real-world assets like Treasuries must still comply with enforceability, custody, and valuation requirements.