The US SEC and CFTC Seek Public Input on Securities, Futures Margin Framework

BlockBeats News, June 26, the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) jointly announced a public consultation on a coordinated framework proposal for the regulation of security-based swaps, securities, futures, swaps, and related margin holdings. The consultation aims to assess whether enhancing regulatory coordination between the two agencies would help improve risk management efficiency, reduce market fragmentation, and enhance customer protection.

SEC Chairman Paul Atkins stated that a cross-margin mechanism is expected to unlock liquidity currently held in separate accounts. CFTC Chairman Mike Selig expressed that enhancing collaboration between the two agencies on portfolio margining is expected to release untapped capital while ensuring a more robust risk management framework and market protection.

This consultation covers topics such as the current portfolio margining model and practices, customer protection considerations, cross-margining and cross-product hedging, capital/isolation/collateral treatment, risk management approaches, clearinghouse and derivatives clearing organization matters, operational and technical implementation issues, as well as potential impacts on market liquidity and competition. The public comment period will be open for 60 days after publication in the Federal Register.