Software developers whose applications enable users to access regulated derivatives markets have been given a measure of certainty by the US Commodity Futures Trading Commission. In a no-action position announced on 17 September 2026, the agency’s Market Participants Division said it will not recommend enforcement against such firms for failing to register as introducing brokers, or against their staff for failing to register as associated persons.
The relief matters because of who it reaches. A near identical position was granted in March to a single wallet developer. The agency has been trimming registration burdens elsewhere too, proposing to cut duplicative CPO and CTA registration for fund advisers. The new letter extends the same treatment to the wider class, which the division labels "Passive Software Providers."
What counts as passive
The letter gives the class the name Passive Software Providers rather than a standalone definition of the phrase. The real boundary is drawn functionally, through what a provider must refrain from doing. The software may do no more than let users reach regulated derivatives markets under their own steam. Three things are off limits. Customer money and assets must never sit with the provider in any form, and the software must not tell anyone what to buy or sell. Once an order is placed, the provider has no say in where it goes or how it is filled.
Inside that boundary, the permitted conduct is commercially substantial. A provider may build and distribute the front end through which users can view market data, review their positions, browse what is on offer, and send orders directly to registered firms, covering event contracts, perpetual contracts, and other regulated derivatives. Event contracts are drawing scrutiny elsewhere, with New York City Council opening an inquiry into prediction-market platforms' marketing. It may contract with those registered firms and share in their revenues. It may charge users a fee per transaction and market itself and the venues it connects to, including promoting particular contracts, and it may introduce and solicit users toward specific firms.
One structural condition underpins all of it. Users have to be transacting on a designated contract market, either as direct members or as customers of a registered futures commission merchant or introducing broker that belongs to that market, with funds held at the clearing organisation or an associated futures commission merchant. That is the conventional custodial shape of exchange-traded derivatives, and the division was clear that the relief does not reach beyond it. Where the interface is embedded within existing wallet software, the provider must make it clear and conspicuous when a user has entered regulated activity.
Ten conditions, and the joint liability one
The letter attaches ten conditions. No statutory disqualification hanging over the firm, its principals or anyone soliciting users; conflicts and fee disclosures that each user acknowledges; a risk disclosure statement; record keeping consistent with the Commission’s retention rule; notice to the division on insolvency or bankruptcy; and a filed notice accepting the conditions and consenting to the Commission’s jurisdiction.
Two conditions carry more weight than the rest. The first is that a provider must run policies and procedures designed to meet the Commission's and the National Futures Association's communications and marketing rules as though it were a registered introducing broker, and must avoid any promotion that would have required the association’s pre-approval had it been registered. Relief from registering, in other words, is not relief from behaving like a registrant when speaking to the market.
The second is the undertaking. Each provider must sign a written agreement with every registered firm it works with, making the two jointly and severally liable for violations related to the covered activities and consenting to the Commission's jurisdiction. Every such undertaking is filed with the division. A registered firm asked to sign one is being asked to assume its software partner’s exposure, which will make these negotiations less routine than a standard vendor agreement.
Users must also be onboarded directly as members or customers of the registered firm, and must keep the ability to reach that firm independently of the software. The provider sits alongside the relationship rather than inside it.
How much comfort this really buys
What the division thinks is not what the Commission has decided. The letter is staff opinion; it does not speak for any other part of the agency, and the Commission itself is free to take a different view. Any material change in the facts can void it. The division kept the right to condition, modify, suspend, terminate or otherwise restrict the position at its discretion.
The relief is also narrow in subject matter. It covers the introducing broker registration requirement and the associated person requirement that sits beside it. It touches nothing else, and leaves anti-fraud and every other obligation under the Commodity Exchange Act exactly where they were.
Nor does it have an end date in the ordinary sense. The position runs until a Commission rulemaking or guidance addresses how the introducing broker requirement applies to software developers, and then stops. That makes it a bridge rather than a destination, and it signals that the substantive question is expected to be settled by the Commission rather than by staff. Where that settlement ultimately comes from may also depend on Congress, given the market-structure legislation that has cleared the Senate Banking Committee.
The read across
The timing invites a comparison. On the same day, the Securities and Exchange Commission exempted a class of venues from the definition of an exchange, and the liquidity providers within them from the definition of a dealer. Here the derivatives regulator has declined to treat interface builders as brokers. The two actions sit at different points in the stack, the SEC’s at the venue and the CFTC’s at the software reaching one, but both loosen a registration perimeter on the same day.
For firms sitting on that line, the practical work is documentary. The conduct limits have to be demonstrable in the product itself, not merely asserted: no custody, no signals, no discretion over routing. Marketing needs to run through a supervisory regime borrowed from a registration category the firm does not hold. And a template joint liability undertaking will have to be agreed with each venue partner, then filed.
