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CFTC reduces marketplace barriers for global development initiatives

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The Commodity Futures Trading Commission’s Division of Swap Dealer and Intermediary Oversight (DSIO) has granted relief to non-US counterparties who enter into swaps with International Financial Institutions (IFIs), such as development banks.

“International financial institutions like the International Monetary Fund and North American Development Bank play a vital role in the global community by promoting infrastructure projects, encouraging employment, and reducing poverty,” says DSIO Division Director Matt Kulkin. “DSIO is providing relief so that these entities can more easily access over-the-counter derivatives markets to hedge risk associated with financing projects in developing countries in order to promote global economic growth.”
 
In the no-action letter, released today, DSIO announced it would not recommend that the Commission take action if non-US persons do not include swaps with IFIs when determining whether such non-US persons meet or exceed agency-prescribed registration thresholds. The relief granted is consistent with the Commission’s prior treatment of IFIs for purposes of foreign futures and options transactions, the swap dealer definition, and mandatory clearing.
 

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