FalconX Seeks SEC Oversight For DeFi Equity Perps
Cryptocurrency prime broker FalconX has asked the Securities and Exchange Commission and the Commodity Futures Trading Commission to bring cash-settled perpetual contracts tied to a single security or narrow-based security index under SEC swap rules when they operate outside the joint listing framework. According to CryptoSlate, the proposal explicitly targets comparable products offered through decentralized finance protocols, bilateral over-the-counter transactions, and non-US trading platforms.
The regulatory filing submitted in August specifies that the request covers perpetuals and related options tied to individual equities or narrow indexes, while explicitly excluding broader digital assets like Bitcoin perpetuals. Under the proposed classification, qualifying contracts falling outside authorized joint security futures regimes would be regulated as security-based swaps. This distinction could subject affected dealers to SEC registration, capital, margin, transaction reporting, and business conduct requirements, though classification depends heavily on specific transaction structures and participant types.
FalconX also requested that regulators reduce duplicated compliance burdens for firms already under CFTC supervision by raising the combined-notional threshold for alternative compliance from 10% to 49%. The public comment window for the regulatory review closed in late August, and neither the FalconX proposal nor alternative recommendations submitted by independent researchers currently constitute official agency policy or alter existing jurisdictional rules.
Based on reporting by cryptoslate.com.
