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The U.S. Commodity Futures Trading Commission (CFTC) has taken a major step toward integrating digital assets into traditional finance by advancing its Stablecoin Collateral Initiative. Acting chairman Caroline Pham announced Tuesday that the proposal would allow stablecoins and other tokenized assets to serve as collateral in derivatives trading.
Public feedback on the Stablecoin Collateral Initiative will be accepted until October 20, with the CFTC focusing on how best to structure policies that let traders use stablecoins to meet margin requirements. The plan builds on Pham’s long-standing advocacy for tokenized collateral and follows her earlier push for regulatory sandboxes and pilot programs.
“For years I have said that collateral management is the ‘killer app’ for stablecoins in markets,” Pham said in her statement.
She argued that enabling stablecoin collateral could strengthen U.S. economic growth by allowing market participants to deploy capital more efficiently.
The Stablecoin Collateral Initiative has drawn support from some of the industry’s biggest players. Circle president Heath Tarbert welcomed the proposal, saying it would allow licensed American stablecoin issuers to bring their products into regulated derivatives markets.
Coinbase’s chief legal officer, Paul Grewal, echoed that sentiment, noting on social media that tokenized collateral “could unlock U.S. derivatives markets” and help the country maintain an edge over global competitors.
Ripple executive Jack McDonald also praised the plan, describing it as “a key step toward integrating stablecoins into regulated financial markets.” He emphasized that clear rules on valuation, custody, and settlement would give institutions the confidence to adopt stablecoin-backed instruments.
Other companies, including Tether and Crypto.com, have also voiced support, suggesting that the Stablecoin Collateral Initiative could gain broad industry backing.
The Stablecoin Collateral Initiative comes on the heels of the GENIUS Act, signed into law by President Trump in July. That legislation created a framework for payment stablecoins but left final regulations pending. By positioning stablecoins like USDC and Tether alongside traditional collateral such as cash and U.S. Treasuries, the CFTC’s proposal would represent a significant leap in legitimizing digital assets within regulated markets.
The move also reflects recommendations made earlier this year by the President’s Working Group on Digital Asset Markets, which urged the CFTC to issue guidance on tokenized non-cash collateral. The Stablecoin Collateral Initiative directly responds to those calls as part of what the agency has described as a broader “crypto sprint.”
The initiative ties into ongoing discussions from the CFTC’s Crypto CEO Forum, held in February, where industry leaders explored the role of tokenized collateral and digital asset pilots. With feedback now being collected until October 20, the agency will refine implementation details in the months ahead.
Pham emphasized that the Stablecoin Collateral Initiative is not just about adapting to innovation but about strengthening the U.S. position in global finance. “These changes will help U.S. economic growth,” she said, pointing to the efficiency gains possible when stablecoins are formally recognized as collateral.
As the Stablecoin Collateral Initiative progresses, all eyes will be on how regulators balance innovation with safeguards, and whether stablecoins can finally move from the periphery of digital assets into the core of regulated financial infrastructure.
