CFTC staff will not recommend enforcement action against passive software providers and their relevant personnel for failing to register as introducing brokers or associated persons, provided they meet specified conditions. The relief covers only the provision and marketing of software connecting users to registered futures commission merchants, introducing brokers and designated contract markets.

The Crypto Council for Innovation welcomed the relief, noting that it applies to all similarly situated developers rather than one firm at a time. Software connecting users to regulated derivatives venues should be treated as software, not a broker, when it does not hold user assets, generate trading signals or control order routing or execution, the council said.

The action came hours after the SEC released its innovation exemption and two days after the Senate blocked the CLARITY Act from advancing, with 49 votes in favor and 50 against, short of the 60 needed. SEC Chair Paul Atkins and CFTC Chair Michael Selig had pledged to advance crypto regulation using their agencies’ existing authority despite the legislative setback.