CFTC Extends March Phantom Wallet Exemption to All Passive-Software Apps

What’s confirmed, and by whom: Two independent outlets, Decrypt and Cointelegraph, report that the Commodity Futures Trading Commission issued a no-action position on Thursday, September 17, 2026, telling “passive software” providers they won’t face enforcement for skipping introducing-broker registration. Both sources agree on the core mechanism, the qualifying conditions and the link to a prior Phantom Technologies letter. Neither source published the full text of the letter.

What the no-action letter actually changes

The CFTC’s Market Participants Division said it will not recommend enforcement against qualifying software providers, or their personnel, for failing to register as introducing brokers or associated persons when they facilitate trading with CFTC-registered firms and exchanges. In practice, that opens a path for crypto wallets and similar apps to route users into regulated derivatives products, including perpetual contracts and prediction markets, without the app itself becoming a registered introducing broker.

The relief is not unconditional. To qualify, a provider must limit its own role in the transaction, including giving up any discretion over a user’s individual orders. That distinction, passive routing versus active order handling, is the line the CFTC is drawing between software that merely connects users to a regulated venue and a broker that manages trades on their behalf.

Built on a March precedent for Phantom

Thursday’s action extends a narrower position the agency granted Phantom Technologies in March for its self-custodial wallet software. That earlier letter let Phantom provide and market software connecting users to registered futures brokers and exchanges, subject to conditions, without registering as an introducing broker itself.

Phantom and the Hyperliquid Policy Center had pushed for broader protections in July, asking the CFTC to shield non-custodial wallet providers from introducing-broker requirements and to clarify how existing rules apply to blockchain developers and regulated derivatives firms using onchain infrastructure. Thursday’s letter widens that earlier carve-out to cover passive software providers generally, not just a single named applicant.

Timing against a stalled Senate bill

Cointelegraph reported that the no-action position arrived two days after the CLARITY Act failed to clear a cloture vote in the Senate. Decrypt’s report did not address that timing, so it stands as a single-sourced detail rather than a confirmed causal link. Still, it fits a pattern already visible this year: when comprehensive market-structure legislation stalls on Capitol Hill, agencies have used narrower administrative tools, no-action letters, interpretive guidance, exemptive orders, to move policy without waiting for Congress.

Read more: Bitcoin ETFs Lose $450M, Deepest Since June, as CLARITY Act Stalls in Senate

Both outlets’ live price feeds showed bitcoin trading near $76,600, up roughly 0.6% at the time of publication, with ether around $2,450. That is background market context rather than a market reaction to the letter itself, since the CFTC’s decision does not target any specific token or exchange. What matters for wallet builders and API users is narrower: a defined, if conditional, route to offer regulated derivatives access without triggering broker registration, and a second data point, after Phantom, on how the agency intends to draw the line between passive software and active brokerage.

Sources

• decrypt.co
• cointelegraph.com