US CFTC Refines Crypto Collateral Pilot Rules: BTC/ETH Capital Adequacy Ratio 20%

March 22nd, according to Cointelegraph, the U.S. Commodity Futures Trading Commission (CFTC) has provided detailed guidance on a pilot program for crypto assets as collateral. The regulator has notified Futures Commission Merchants (FCMs) that participation in the pilot requires submitting an announcement to the Market Participants Division, stating the start date for accepting crypto assets as margin. Key points include: 1. Capital Requirements: Only Bitcoin, Ethereum, and stablecoins can be accepted as collateral. BTC/ETH will be calculated at a 20% capital adequacy ratio, and stablecoins at 2%. FCMs participating in the pilot program can only accept Bitcoin, Ethereum, or stablecoins for the first three months. 2. Compliance and Reporting Obligations: FCMs participating in the pilot must promptly report significant cybersecurity or system issues and submit weekly reports on the total amount of crypto assets in customer accounts. 3. Expansion After Three Months: Other crypto assets can be used as collateral after three months, and some reporting requirements will be terminated. 4. Limited Use: Only dedicated payment stablecoins are allowed to be deposited into the remaining equity of customer segregated accounts. Crypto assets cannot be used for uncleared swap collateral, but eligible tokenized assets can be substituted. 5. Derivatives Clearinghouse Requirements: Clearinghouses that meet the CFTC's credit, market, and liquidity risk requirements can accept crypto assets and stablecoins as initial margin for cleared trades.