This Week in Derivatives

New Developments

• U.S. Senate Passes GENIUS Act. On June 16, the Senate passed the bipartisan Guiding and Establishing National Innovation for US Stablecoins Act, or GENIUS Act, in a 68-30 vote. If passed in the House, the GENIUS Act would establish the first federal rules for regulating stablecoins, a type of digital asset pegged to the value of another asset, oftentimes the U.S. dollar. The GENIUS Act now heads for a vote in the House. [NEW]
• Former CFTC Chairman William Bagley Dies at 96. On June 16, CFTC acting Chairman Caroline D. Pham released a statement on the passing of the Hon. William T. Bagley, the CFTC’s first chairman. Appointed to the position by President Gerald Ford, William Bagley served as the Chairman of the CFTC from 1975 to 1978. He passed away on June 9, 2025 at his home in San Rafael, California. [NEW]
• CFTC, SEC Further Extend Form PF Amendments Compliance Date. On June 11, the CFTC, together with the SEC, extended the compliance date for the amendments to Form PF, the confidential reporting form for certain SEC-registered investment advisers to private funds, including those that also are registered with the CFTC as commodity pool operators or commodity trading advisers, that were adopted February 8, 2024. The compliance date for these amendments, which was June 12, 2025, has been extended to October 1, 2025. The release provides that Form PF filers should continue to file the current version of Form PF until the date the release is published in the Federal Register. In connection with the extension, Commissioner Johnson released a statement indicating that the extension was due to “technology-based concerns as well as challenges with validation, testing, and ensuring effective capabilities for timely and accurate reporting of requested information.”
• Senate Agriculture Committee Holds Hearing on Quintenz Nomination. On June 10, the Senate Agriculture Committee considered Brian Quintenz’s nomination for Chairman and Commissioner of the CFTC. In his opening remarks, he states that his goals for the agency will include risk management, fostering innovation, and facilitating reciprocity with foreign jurisdictions. The hearing also focused on several core issues including event contracts, resource allocation within the CFTC, and 24/7 trading. Quintenz states that, in his view, all event contracts are permissible under the Commodity Exchange Act, though he highlighted that the statute should be clarified with respect to its “gaming” provision. Quintenz also maintained that the CFTC should have more resources to allocate for digital asset oversight. Finally, with respect to 24/7 trading, Quintenz stated that he intends to listen to all stakeholders in determining which markets may allow for longer trading hours. Quintenz previously served as a CFTC commissioner from 2017 to 2021.
• CLARITY Act. On June 10, the CLARITY Act, which seeks to establish a regulatory framework for digital assets in the U.S. and would give the CFTC authority over crypto spot markets, advanced to the full U.S. House of Representatives after passing in the House Committee on Financial Services (32 to 19), and the House Agriculture Committee (47 to 6).
• SEC to Resume Processing of Registration Applications From Swiss-Based Investment Advisers. On June 10, the SEC announced that it will immediately resume processing new and pending registration applications of investment

New Developments Outside the U.S.

• ESMA Publishes Final Report on Active Account Requirement Under EMIR 3. On June 19, ESMA published its final report on the Regulatory Technical Standards  specifying the conditions under which the active account requirement should be met, as mandated under  the European Market Infrastructure Regulation (“EMIR”) 3. ESMA has streamlined the operational conditions and the stress-testing in response to feedback to its public consultation. [NEW]
• ESMA Consults on Methodology for Computing EU Member States’ Market Capitalization and Market Capitalization Ratios. On June 19, ESMA announced that it is consulting on the methodology for calculating market capitalization and market capitalization ratios, as mandated by the Directive on faster and safer relief of excess withholding taxes. The proposed methodology is aligned with existing transparency frameworks and uses transaction data reported under the Regulation on markets in financial instruments. [NEW]
• ESMA appoints Ante Žigman to its Management Board and appoints new Chairs to two standing committees. On June 18, ESMA appointed Ante Žigman as a new member of its Management Board. The election took place at the Board of Supervisors meeting in Warsaw on 17 June, and he will take up his position on 6 July 2025. [NEW]
• ESMA’s activities in 2024 focused on strengthening the EU capital markets and putting citizens and businesses at the heart of it. On June 16, ESMA published its Annual Report for 2024. The activities conducted and results achieved in 2024 support ESMA’s strategic priorities and thematic drivers - to foster stable and effective markets, strengthen supervision, and enhance retail investor protection while enabling sustainable finance and facilitating technological innovation and the use of data. [NEW]
• ESMA Publishes Principles for Third-party Risk Supervision. On June 12, ESMA published its newly developed Principles on third-party risks supervision. ESMA said that the principles aim at supporting a common and effective EU-wide supervisory culture. According to ESMA, the 14 principles on third-party risks were developed to address the growing risks observed over recent years in the use of outsourcing, delegation, or other types of third-party services by supervised firms and that they are intended to provide a common supervisory basis to National Competent Authorities and ESMA, enhance the robustness of supervisory frameworks and help supervised entities understand and manage third-party risks.

New Industry-Led Developments

• ISDA Publishes Research Note on Interest Rate Derivatives Trading in the US, EU and UK. On June 18, ISDA published a research note that analyzes changes in interest rate derivatives trading activity in the US, EU and UK from 2021 to 2024. It examines how central bank interest rate policies influenced IRD trading volumes and how the composition of interest rate derivativesproducts has evolved due to the transition to alternative reference rates. [NEW]
• ISDA Responds to ESMA on Clearing Threshold Regime. On June 16, ISDA responded to ESMA’s consultation on the new clearing threshold regime. The new regime, based on uncleared positions, was introduced in the context of EMIR 3. In the response, ISDA comments on the data analysis provided by ESMA, the interaction with the active account requirements, in particular condition 2 of EMIR 3 Article 7a(1), and proposes an implementation approach suitable for financial and non-financial counterparties, in line with the European Union’s broader simplification and burden reduction agenda. [NEW]
• ISDA Launches Pre-adherence Period for Notices Hub. On June 12, ISDA began a pre-adherence process for the ISDA Notices Hub. The new protocol will change all agreements between adhering firms to allow them to use the ISDA Notices Hub – a secure online platform managed by S&P Global Market Intelligence that will enable the instantaneous delivery and receipt of termination notices and waivers ISDA has begun a pre-adherence process for the ISDA Notices Hub, enabling firms to sign up to a free protocol that will allow them to use the new platform when it launches on July 15.
• ISDA Publishes “Creating Value – IQ” June 2025. On June 10, ISDA published ISDA Quarterly, which explored how and why different types of firms use derivatives and the value they bring to individual companies and the broader economy. The report was published to coincide with ISDA’s 40th anniversary, and continue ISDA’s IQ anniversary series by looking at how ISDA and its members have worked to address some of the biggest challenges ever to face derivatives markets – from the rollout of margin requirements for non-cleared derivatives to the transition from LIBOR.
• ISDA Publishes Paper on the EC’s Sustainability Omnibus Proposal. On June 9, ISDA published a position paper setting out its views on the European Commission’s (EC) Sustainability Omnibus Package. In the paper, ISDA urges European authorities to, among other things, ensure a proportionate, harmonized and symmetrical approach to the use of derivatives across the EU’s sustainable finance framework in line with the EU’s Platform on Sustainable Finance derivatives recommendations.