FalconX Becomes First Registered Crypto Swap Dealer | Practical Law

FalconX Becomes First Registered Crypto Swap Dealer | Practical Law

FalconX, a digital assets and cryptocurrency platform for institutional investors, became the first cryptocurrency swap dealer registered with the National Futures Association (NFA) and among the first crypto platforms to become a primary level member of the International Swaps & Derivatives Association (ISDA).

FalconX Becomes First Registered Crypto Swap Dealer

Practical Law Legal Update w-035-3486 (Approx. 4 pages)

FalconX Becomes First Registered Crypto Swap Dealer

by Practical Law Finance
Published on 26 Apr 2022 • USA (National/Federal)
FalconX, a digital assets and cryptocurrency platform for institutional investors, became the first cryptocurrency swap dealer registered with the National Futures Association (NFA) and among the first crypto platforms to become a primary level member of the International Swaps & Derivatives Association (ISDA).
On April 13, 2022, Soilos Inc., d/b/a FalconX, a prime broker for digital assets that provides institutional investors access to the over-the-counter (OTC) cryptocurrency derivatives market, announced that it has become the first cryptocurrency swap dealer registered with the National Futures Association (NFA) and among the first crypto platforms to become a primary level member of the International Swaps & Derivatives Association (ISDA®).
ISDA's primary membership category is designed for international and regional banks, insurance companies, diversified financial firms, and energy and commodities firms. It includes over 200 large global institutions that deal in derivatives. FalconX is also a licensed money services business (MSB) registered with the US Department of the Treasury's Financial Crimes Enforcement Network (FinCEN) (see Practice Note, FinCEN Regulation of Virtual Currency: Overview).
According to FalconX, the registration:
  • Will allow institutional investors access to regulated crypto derivatives trading in the US.
  • Will create a venue for FalconX's clients to trade OTC crypto derivatives.
  • Will allow FalconX's clients to enter into forwards, options, and swap transactions with the industry's most trusted framework.
  • Will prevent FalconX's clients from undergoing changes to their operational processes by using FalconX's established standards for timing, valuation and confirmation.
  • Will allow FalconX's investors to offer crypto derivatives to their client base with well-managed risk exposure.
For further information on regulation of digital assets, see the following Practical Law resources: