1. CFTC Proposes Rule Changes for CPO and CTA Registration
On Aug. 21, the Commodity Futures Trading Commission (CFTC) published a notice of proposed rulemaking to reduce duplicative registration and compliance obligations for certain commodity pool operators (CPOs) and commodity trading advisors (CTAs). The centerpiece of the proposal is new Regulation 4.13(a)(4), which would exempt Securities and Exchange Commission (SEC)-registered investment advisors (RIAs) from CPO registration with respect to commodity pools whose participants are limited to qualified eligible persons and certain accredited investors, provided additional conditions are met, including that pool interests are privately offered, the RIA files Form PF where required, and the pools are not marketed to the general public (with a limited exception for Rule 506(c) offerings). The proposed rule largely codifies and refines the no-action positions previously issued by the CFTC’s Market Participants Division in Staff Letters 25–50 and 26–06, which the CFTC intends to supersede upon finalization. A conforming amendment would also restore a related CTA registration exemption under Regulation 4.14(a)(8) for advisors to pools qualifying under the new exemption.
In addition, the CFTC is proposing to double the gross capital contributions threshold for the Small Pool Exemption under Regulation 4.13(a)(2) from $400,000 to $800,000, reflecting cumulative inflation since the threshold was last adjusted in 2003. Comments on the proposal are due by Oct. 5. See the proposed rule here and the CFTC’s press release here.
2. CFTC Issues Request for Comment on the Listing of Compute Derivatives Contracts
On Aug. 19, the CFTC issued a request for comment in connection with compute derivatives contracts. Compute derivatives contracts are financial instruments that reference the price of access to computing power used by large language models at the center of the artificial intelligence (AI) economy. The CFTC noted that compute has become a “multi-hundred-billion-dollar enterprise” and a scarce, capital-intensive commodity, with one study estimating the gross compute service flow at approximately $430 billion to $1.3 trillion per year, or roughly 1.4% to 4.0% of U.S. GDP. The initiative aligns with the White House’s July 2025 AI Action Plan, which recommended improving the financial market for compute to ensure access for startups and academics.
The CFTC acknowledged several potential challenges to the development of a mature compute derivatives market, including fragmented and opaque bilateral pricing, the absence of standardized pricing benchmarks, dominant market participants that may wield significant pricing power, and questions around fungibility and deliverable supply. The request for comment poses detailed questions across four categories: the size, liquidity, and characteristics of compute cash markets; market oversight and susceptibility to manipulation under Designated Contract Market Core Principles 3 and 4; customer protection considerations (including AML/KYC concerns and retail participant safeguards); and the potential role of perpetual compute futures. Comments are due by Oct. 20. See the request for comment here and the CFTC’s press release here.
3. U.S. Treasury Announces the Quantum-Readiness Task Force
On Aug. 24, the U.S. Department of the Treasury (Treasury) announced the launch of the Quantum-Readiness Task Force (Task Force), which will support efforts to secure U.S. innovation, strengthen supply chains, and foster U.S. leadership in emerging technologies. The Task Force is a public-private initiative designed to advance President Donald Trump’s agenda to strengthen protections for critical financial infrastructure. The Task Force will focus on industry alignment and post-quantum cryptography transition, third-party and vendor readiness, and digital assets and emerging technology risk. As described in the Treasury’s press release, the Task Force’s mandate is to bring together government, financial institutions, financial markets, and technology leaders in an effort to coordinate readiness for quantum-related cyber risks. See the Treasury’s press release here.
4. CFTC Hosts Inaugural Innovation Advisory Committee Meeting
On Aug. 20, the CFTC hosted the inaugural meeting of the Innovation Advisory Committee (Committee) in Washington, D.C. The Committee was established to advise the CFTC in connection with complex issues relating to technology, law, policy, and finance. Committee members included innovators, entrepreneurs, academics, and other notable industry participants who provided industry insights and recommendations to the CFTC. Topics discussed included crypto market regulations and the evolving regulatory landscape, prediction markets, and AI. Industry leaders provided their points of view regarding self-certifications for prediction market contracts and the potential risks, regulatory efficiency, and market demand associated with self-certified contracts. View the entire meeting here.
5. SEC Continues Crackdown on Fraudulent Schemes Relating to Pre-IPO Stocks
On Aug. 14, the SEC filed a complaint in the U.S. District Court for the Southern District of New York charging a New York resident and three entities he owned and controlled in connection with a fraudulent, unregistered securities scheme involving pre-IPO investment funds. According to the complaint, from December 2020 through at least June 2025, the defendants raised over $74 million from more than 800 investors, including retail investors, across 11 private funds that purported to offer access to shares of private companies ahead of an IPO. The SEC alleges the defendants operated boiler rooms staffed by over 100 sales agents who cold-called prospective investors using high-pressure scripts, while concealing massive markups embedded in the prices charged to investors for fund interests.
The SEC claims that the defendants acquired pre-IPO securities and resold them to the funds at prices averaging approximately 46% above their acquisition cost, generating roughly $23 million in hidden fees, of which at least $4 million was used for personal expenses. The complaint alleges violations of the antifraud, securities registration, broker-dealer registration, and investment advisor provisions of the Securities Act, Exchange Act, and Advisers Act. See the SEC’s press release here and a copy of the complaint here.
