The “Killer App” Arrives: CFTC Greenlights Stablecoins for Derivatives Collateral

The CFTC has officially recognized what crypto advocates have long predicted: the primary use for stablecoins in high finance is as collateral.

In a landmark move, the agency is launching an initiative to permit stablecoins like USDC and Tether to be used as collateral in derivatives markets, treating them similarly to traditional government securities.

“Collateral management is the ‘killer app’ for stablecoins in markets,” declared CFTC Acting Chair Caroline Pham, announcing the proposal.

With strong backing from the industry and the legal foundation of the GENIUS Act, this decision marks a pivotal moment in the adoption of digital assets, potentially funneling billions in stablecoin liquidity into the regulated financial system.