Lowenstein Crypto advises leading digital asset and cryptocurrency projects, exchanges, and trading firms. Our practice covers regulatory advice, transactions and structuring advice, investigations, and adversarial matters including commercial disputes, bankruptcy, and related litigation. As these markets continue their rapid growth and market participants continue to evolve and mature their businesses, we are providing this weekly digest as a resource that highlights and summarizes a selection of key recent legal regulatory developments.

CFTC Staff Releases Updates to FAQs Relating to Crypto Assets and Blockchain Technologies

On September 24, the Commodity Futures Trading Commission's (CFTC) Market Participants Division, Division of Market Oversight, and Division of Clearing and Risk published updated FAQs clarifying how registrants and registered entities may engage with crypto assets and blockchain technology under the Commodity Exchange Act. Building on earlier Staff Letters 25-39 and 26-05, the guidance confirms that futures commission merchants (FCMs) may apply customer-deposited non-security crypto assets (including payment stablecoins) as margin and to secure debit/deficit balances, and may deposit proprietary payment stablecoins, but not other crypto assets like bitcoin or ether, as residual interest in segregated customer accounts, subject to a minimum 2 percent capital charge. The update also sets a 20 percent capital charge on proprietary positions in bitcoin and ether, aligned with the SEC’s broker-dealer haircut framework, and permits derivatives clearing organizations (DCOs) to accept crypto assets as initial margin for cleared transactions provided they meet existing risk standards. Notably, four new questions added on September 24 allow FCMs and DCOs to invest customer funds in tokenized forms of otherwise permitted investments under Regulation 1.25 (such as tokenized money market fund shares) provided the tokenized asset carries equivalent legal and economic rights, and green-light the use of blockchain and distributed ledger technologies for recordkeeping under Regulations 1.31 and 45.2, including the option to forego maintaining separate offchain copies, so long as entities can produce records for the Commission even during network disruptions. See a copy of the FAQs here.

CFTC Chairman Signals New Era For Treasury Markets and Tokenization

On September 22, CFTC Chairman Michael Selig, speaking at the 2026 U.S. Treasury Market Conference, outlined the CFTC’s evolving role amid a Treasury derivatives ecosystem that has grown to roughly $60 trillion in short-term interest-rate open interest and $2 trillion in daily USD swap turnover, underscoring that derivatives are now core to Treasury market liquidity and price discovery, not merely hedging tools. Looking forward, Selig called tokenization a potential foundation for “near-instantaneous settlement and real-time collateral mobility,” noting that the CFTC has already approved certain payment stablecoins as eligible collateral under the newly enacted GENIUS Act. He further stated that the CFTC is taking an asset-class-specific approach to continuous trading, supporting it for crypto and precious metals while cautioning that agricultural and energy markets may not be ready. See the statement here.

NYSE and Blockchain.com Announce Strategic Collaboration for 24/7 Tokenized Stocks 

On September 22, Blockchain.com and NYSE Group announced a strategic collaboration to explore offering 24/7 global access to tokenized versions of NYSE-listed U.S. stocks and exchange-traded funds, enabling crypto-native investors worldwide to trade without the traditional constraints of market hours, geography, or brokerage access. The partnership also establishes a two-way data exchange: ICE Data Services will distribute Blockchain.com’s crypto market data to its institutional clients, while Blockchain.com will integrate ICE and NYSE real-time stock data into its platform for its 44 million-plus users. Building on Blockchain.com’s earlier partnership with Ondo Finance to offer tokenized U.S. stocks in Europe, the NYSE agreement represents a further step toward convergence between traditional capital markets and digital assets. See the announcement from Blockchain.com here.

ESMA Announces AI and Tokenization as Supervisory Priorities for 2027 

On September 23, the European Securities and Markets Authority (ESMA) announced the launch of a new Union Strategic Supervisory Priority (USSP) in an effort to embrace innovation while protecting investors and maintaining robust safeguards. The digital innovation USSP focuses on where artificial intelligence, tokenization, and other emerging technologies may be used by supervised entities in financial markets. In 2027, regulators will aim to support innovation by engaging with the market on benefits, building supervisory-ready frameworks, and ensuring robust governance and client-aligned outcomes. See the press release here and the related fact sheet here.

Crypto Council for Innovation Asks NYDFS To Pause Rulemaking Until Federal Framework Is Finalized 

On September 21, the Crypto Council for Innovation (CCI) submitted a comment letter to New York’s Department of Financial Services (NYDFS) urging it to pause its proposed rule for authorized payment stablecoin issuers until the federal regulatory framework under the GENIUS Act is finalized. CCI argues that with Treasury’s substantial-similarity criteria, the OCC’s implementing regulations, and the FDIC’s and Federal Reserve’s frameworks all still in flux, it is premature for New York to lock in a state-level regime that may need significant revision to obtain certification as “substantially similar” to the federal framework. Should NYDFS proceed, CCI recommends several targeted changes: adopting a per-issuer rather than per-stablecoin licensing model to preserve white-label innovation, streamlining licensing for non-issuer stablecoin service providers, keeping the yield prohibition narrowed to issuer-paid interest only, removing the prior-approval requirement for non-IDI custodians, reconsidering the impracticable minimum insured-deposit mandate, aligning capital requirements with the OCC’s approach, harmonizing the “nonpublic information” definition with the federal standard rather than layering on state cybersecurity rules, and clarifying that consumer-protection compliance refers to New York law rather than creating a de facto multistate licensing burden. See the letter here.