CFTC seeks public feedback on potential updates to risk management

In an effort to modernize and modernize its risk management regulations, the U.S. Commodity Futures Trading Commission CFTC sought public feedback on potential updates.

The CFTC issued a proposal on Thursday, asking comment on proposed alterations to its risk management program, including: 1. The risk related to safeguarding counterparty collateral and segregating customer funds. The inherent volatility and potential risks associated with digital assets held by businesses must be factored into the amendments, CFTC Commissioner Christy Goldsmith Romero said.

Romero, speaking at a press conference, emphasised that emerging technologies, such as digital assets, artificial intelligence, and cloud services, pose significant risks. It is similar to other regulators reassessing their oversight in this area. Romero emphasized the ongoing concerns surrounding the industry's practices in safeguarding clients' assets. Brokers may consider keeping customer assets in the form of digital assets, such as stablecoins, or other digital assets, potentially leading to unanticipated and unique risks, she said. The public is invited to share their views on CFTC's proposed rulemaking notice for 60 days.

This notice marks the beginning of a process that would ultimately lead to a formal proposed rule and a final vote.