Sec. 103. Rulemakings
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The Commodity Futures Trading Commission shall issue rules to further define the terms associated person of a digital commodity broker , associated person of a digital commodity dealer , blockchain , blockchain application , blockchain protocol , blockchain system , decentralized finance messaging system , decentralized finance trading protocol , decentralized governance system , and digital commodity (as defined in section 1a of the Commodity Exchange Act ( 7 U.S.C. 1a )). The Commodity Futures Trading Commission and the Securities and Exchange Commission shall jointly issue rules to exempt persons dually registered with the Commodity Futures Trading Commission and the Securities and Exchange Commission from duplicative, conflicting, or unduly burdensome provisions of this Act, the securities laws (as defined in section 3(a) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78c(a) )), and the Commodity Exchange Act ( 7 U.S.C. 1 et seq. ), and the rules under those Acts, to the extent that the exemption would— foster the development of fair and orderly markets in digital assets; be necessary or appropriate for the protection of customers; and be consistent with the protection of investors.
The Commodity Futures Trading Commission and the Securities and Exchange Commission shall jointly issue rules applicable to mixed digital asset transactions under this Act and the amendments made by this Act, including by further defining such term. Not later than 180 days after the date of enactment of this Act, the Commodity Futures Trading Commission and the Securities and Exchange Commission (referred to in this subsection as the Commissions ) shall jointly issue rules, procedures, or guidance (as determined appropriate by the Commissions) regarding the process to delist an asset for trading under section 104 if the Commissions determine that the listing is inconsistent with the Commodity Exchange Act ( 7 U.S.C. 1 et seq. ), the securities laws (as defined in section 3(a) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78c(a) )) (including regulations under those laws), or this Act.
Not later than 360 days after the date of enactment of this Act, the Commodity Futures Trading Commission and the Securities and Exchange Commission shall jointly issue rules with respect to margin, customer protection, segregation, or other requirements as necessary to facilitate portfolio margining of securities (including related extensions of credit), security-based swaps, contracts for future delivery, options on a contract for future delivery, swaps, and digital commodities, or any subset thereof, in— a securities account carried by a registered broker or dealer or a security-based swap account carried by a registered security-based swap dealer; a futures or cleared swap account carried by a registered futures commission merchant (as defined in section 1a of the Commodity Exchange Act ( 7 U.S.C. 1a )); a swap account carried by a swap dealer; or a digital commodity account carried by a registered digital commodity broker or digital commodity dealer that is also registered in such other capacity as is necessary to also carry the other customer or counterparty positions being held in the account.
With respect to a joint rulemaking described in paragraph (1)— the joint rule shall be in the public interest and provide for the appropriate protection of customers; the Commodity Futures Trading Commission and the Securities and Exchange Commission shall consider the public interest of the joint rule through the solicitation of public comments; and the Commodity Futures Trading Commission and the Securities and Exchange Commission shall consult with other relevant foreign or domestic regulators, including the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency, as appropriate.
Not later than 18 months after the date of enactment of this Act, the Commodity Futures Trading Commission shall issue rules establishing requirements for the identification, mitigation, and resolution of conflicts of interest among and across registered entities (as defined in section 1a of the Commodity Exchange Act ( 7 U.S.C. 1a )) and persons required to be registered with the Commodity Futures Trading Commission, including conflicts of interest related to vertically integrated market structures.
The rules issued under paragraph
(1)shall, at a minimum— establish governance, personnel, and financial resource separation among affiliated entities that perform distinct regulated functions; prohibit trading facilities or intermediaries from acting as counterparties to customer transactions or otherwise engaging in self-dealing, except as provided in section 5i(b)(2)(B) of the Commodity Exchange Act; require appropriate safeguards for custody and use of customer assets to prevent conflicts arising from commingling or misuse; mandate disclosure and management of material conflicts, including those involving affiliated entities or proprietary trading; and ensure independent oversight and decision-making in market operations and compliance.
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