CFTC’s Stablecoin Gambit: Trust Banks Get the Green Light

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With a flourish of bureaucratic grandeur, U.S. regulators have bestowed upon stablecoins the imprimatur of federal legitimacy, while national trust banks are now permitted to play dress-up as token issuers. A triumph of modern finance, or merely a well-dressed farce?

CFTC Expands Eligible Stablecoins for Regulated Collateral Use

The Commodity Futures Trading Commission (CFTC), in a moment of regulatory audacity, announced on Feb. 6 the reissue of CFTC Staff Letter 25-40. This document, one imagines, was penned with the solemnity of a medieval courtier, revising the definition of payment stablecoins to permit national trust banks to don the mantle of “permitted issuers,” as if they had been waiting for this honor with bated breath since the dawn of fintech.

CFTC Chairman Michael S. Selig, ever the statesman of crypto, shared on X:

“Today, CFTC staff is expanding the list of eligible tokenized collateral to include stablecoins issued by national trust banks. With the enactment of the GENIUS Act-a legislative marvel-and the CFTC’s new eligible collateral framework, America is the global leader in stablecoin innovation.” One suspects the word “innovation” here is used loosely, like a well-tailored suit at a family reunion.

The staff action, with all the subtlety of a marching band at a funeral, modified an existing no-action position affecting futures commission merchants who accept non-securities digital assets as customer margin collateral. These merchants, it seems, were permitted to hold certain proprietary payment stablecoins in segregated customer accounts-though one wonders if segregation is truly necessary when the entire endeavor is already a house of cards.

The reissued letter, a document of such labyrinthine complexity it could double as a tax return, builds on the original Staff Letter 25-40, published Dec. 8, 2025. This letter, as dry as a desert and twice as uninviting, outlined relief from specific requirements when customer margin collateral consists of qualifying non-securities digital assets, including payment stablecoins. After publication, Market Participants Division personnel-those tireless guardians of financial clarity-realized that the original definition had, with the grace of a stampeding elephant, excluded payment stablecoins issued by national trust banks. A minor oversight, perhaps, but one that left those banks feeling like the last guest at a dinner party who forgot to RSVP.

Discussing the regulatory background, Selig waxed poetic: “During President Trump’s initial term, the Office of the Comptroller of the Currency made history by chartering the first national trust banks with authority to custody and issue payment stablecoins. These national trust banks continue to play an important role in the payment stablecoin ecosystem.” He added:

“I’m pleased that the CFTC staff is amending its previously issued no-action letter to expand the list of eligible tokenized collateral to include payment stablecoins issued by these institutions.” One might argue that the real pleasure lies in the paperwork, but we shall not quibble.

Division staff, ever the pragmatists, clarified that the exclusion had created unnecessary uncertainty for registered intermediaries, much like a misplaced comma in a Shakespearean sonnet. By explicitly adding national trust banks as permitted issuers, the updated definition harmonizes the guidance with existing federal charters, reduces interpretive friction for futures commission merchants (who now need not squint quite so hard), and supports consistent collateral treatment across regulated derivatives markets. The revision, in a masterstroke of regulatory theater, preserves all substantive conditions and limitations of the original relief while reinforcing the role of federally chartered trust banks in the evolving stablecoin landscape, where payment-focused tokens increasingly intersect with traditional market infrastructure-like oil and water, but with more spreadsheets.

FAQ ⏰

  • What did CFTC Staff Letter 25-40 change?
    It updated the payment stablecoin definition to include tokens issued by national trust banks. A change so profound, it could rival the invention of the wheel-or at least the rebranding of it as a “sustainable mobility solution.”
  • Why are national trust banks important to stablecoins?
    They are federally chartered institutions authorized to custody and issue payment stablecoins. One might say they are the Swiss Army knives of the financial world, though with less versatility and more red tape.
  • How does the update affect futures commission merchants?
    It reduces uncertainty when accepting qualifying stablecoins as customer margin collateral. A relief akin to finding a seat on a crowded train, though the journey remains perilous.
  • Does the revision alter existing compliance conditions?
    No, it preserves all substantive limitations from the original no-action relief. A testament to the CFTC’s commitment to consistency-or perhaps its devotion to the art of the bureaucratic tautology.

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2026-02-07 15:12