CFTC staff turn Phantom's wallet no-action letter into a class-wide position

The four conditions constrain what the product can do. A covered provider cannot custody the assets backing a derivatives position, cannot generate express trading signals, cannot exercise discretion over routing or execution, and cannot send customers toward unregistered venues, according to news.bitcoin.com's account of the letter ^[4]. Each of those is something a person decides in code.

The permission is specific. Software can display market data and contracts, let users submit orders directly to registered futures commission merchants, introducing brokers or designated contract markets, market those products, and collect transaction-based fees, without that alone forcing the developer to register as an introducing broker ^[3]. What it gives up is the part that usually justifies a take rate: choosing the venue and telling the user what to trade. A front end that adds smart order routing or a signals feed later is outside the stated boundaries ^[4].

This is a staff position. The Market Participants Division has said it will not recommend enforcement when developers stay inside the specified limits, and Congress has not rewritten the Commodity Exchange Act ^[6]. The position sets no expiry date and runs until formal Commission rulemaking or guidance addresses how introducing-broker registration applies to software providers, the same endpoint Phantom's March letter carried ^[7][8].

Phantom's framework was public in March. What the class-wide letter changes is who carries the uncertainty. Before Sept. 17, per news.bitcoin.com, a developer had to look at Phantom's letter and wonder whether the same logic could apply; the staff position is now broadly available to similarly situated passive software providers ^[9][1].

The phrase "passive software" is broader than the relief. It attaches to software connecting users with registered CFTC venues and intermediaries, and the same account says it does not legalize offshore crypto perpetual platforms or hand every DeFi derivatives protocol a pass ^[10]. Users still onboard directly with the registered market participant, and covered providers take on disclosure, recordkeeping and marketing requirements ^[5][11].

For a team deciding this quarter, the six months between Staff Letter 26-09 and Staff Letter 26-25 is the only pace information on the record ^[12]. Designing to the conditions now costs less than retrofitting custody and routing out of a shipped wallet. The Commission has yet to decide what registration means for software providers, and the division has told builders where it will not pursue them until it does ^[7][6].