NFA Releases Crypto Activities Compliance Rules

In this era where there are no official crypto rules for government agencies in the US, the National Futures Association (NFA) sets standards for its members trading digital assets. NFA, a self-regulatory organization positioned between the federal government and the industry, has more than 100 members trading digital assets. The organization has published a statement regarding the rules in question, which is expected to come into effect on May 31. The NFA’s self-regulation of the capital markets derivatives industry allows it to set standards that include fines and other penalties for its members, and this competence of the organization remains valid for the crypto industry as well.

In the aforementioned statement of the NFA, he stated that the compliance rules are limited to Bitcoin (BTC) and ETHs only for now. The NFA’s statement states that compliance rules allow the NFA to punish a member or adopt other action to protect the public if they commit fraud or similar abuses related to futures digital asset activities. Emphasizing the need for members to closely monitor their activities, it is also noted that members engaged in futures crypto-commodity activities should determine and implement appropriate supervisory policies and procedures for these activities.

As the Commodity Futures Trading Commission (CFTC) oversees the entire industry with the NFA, questions remain about the extent of its mandate over digital assets. A series of initiatives from Congress to pass legislation aim to give the CFTC undeniable powers over cryptoassets and the spot market. These attempts, however, have yet to yield any results.

CFTC Commissioner Caroline Pham said in a statement posted on her agency’s website:

This move by NFA is a clear example of using existing authority to keep customers protected. These obligations will enable NFA members and partners to transparently disclose the risks associated with spot bitcoin and ether trading so clients are fully informed before making any investment decisions.

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