Among the various crypto initiatives undertaken by the US government comes the latest one by the US Commodity Futures Trading Commission (CFTC). The commission has considered a new initiative allowing stablecoins to be used as tokenized collateral in derivatives markets.
Crypto in traditional derivatives market
To put it another way, traders in options and futures markets can use stablecoins to back their assets, rather than relying on traditional assets. This initiative signifies a convergence between traditional and digital finance, with cryptocurrency becoming an integral part of mainstream financial markets.
CFTC’s acting head, Caroline Pham, has long been advocating for stablecoins as collateral in the derivatives market. In an official statement, she noted that one of the most powerful practical applications of stablecoins is to serve as collateral in financial markets. “I’m excited to announce the launch of this initiative to work closely with stakeholders to enable the use of tokenized collateral, including stablecoins.”
Stablecoins are fueled by the GENIUS Act
The GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins Act), issued by the US government, is the country’s first regulatory federal framework for payment stablecoins. This law seeks to protect consumers, bolster the US dollar’s dominance, mitigate illicit activities in crypto assets, and more.
Since the enactment of the GENIUS Act, stablecoin issuers have taken the opportunity to grow within this thriving crypto environment. The initiative to consider stablecoins as collateral also stems from this foundational law.
Worth noting, stablecoin issuer Tether’s new stablecoin, USAT, and Ripple’s RLUSD stablecoin launched in the context of the GENIUS Act. If CFTC implements the initiative, Tether’s USDT, Circle’s USDC, and Ripple’s RLUSD have the potential to gain attention in the derivatives market.
CFTC initiative attracts key industry players
For several crypto executives, using stablecoins as collateral in the derivatives market is a strategic ace. Major stablecoin issuers like Ripple, Tether, and Circle have praised the CFTC’s game-changing venture.
Circle President Heath Tarbert underlined that bringing stablecoins into derivatives will make trading safer, cheaper, and more efficient. Kris Marszalek, the CEO of Crypto.com, appreciated CFTC’s move to use non-cash collateral. In a public event i May 2025, Joseph Spiro, product director at DTCC Digital Assets, underscored that digital assets are a perfect use case for collateral across a wide range of financial instruments.
