CFTC Proposes CPO and CTA Rule Changes for Fund Managers

The Commodity Futures Trading Commission (CFTC) is seeking public feedback on proposed changes to regulations governing commodity pool operators (CPOs) and commodity trading advisors (CTAs), including investor eligibility, registration exemptions and fund reporting requirements.

The proposal targets Part 4 of CFTC regulations, which covers CPOs and CTAs participating in U.S. commodity interest markets. A key focus is the Qualified Eligible Person (QEP) framework, which determines whether sophisticated investors can access commodity pools and advisory programs operating with reduced disclosure and reporting obligations.

QEP eligibility has received increased attention as the CFTC updates portfolio requirements that had become outdated due to changes in asset values. The agency finalized revised portfolio thresholds in September 2024, with the new standards taking effect in March 2025. The latest CFTC proposal continues regulatory work that began with proposed amendments to Regulation 4.7 in 2023.

The CFTC is also reviewing registration relief for registered investment advisers managing private funds for QEPs. After exemptions were withdrawn in 2012, the agency restored certain relief through No Action Letter 25-50. It is now considering incorporating that relief directly into CFTC regulations, potentially allowing eligible investment advisers to claim a formal exemption from CPO registration instead of relying on no-action letters.

Fund-of-funds reporting requirements are another area under review. Because these investment structures allocate capital through other funds, managers can face overlapping filing obligations. Proposed changes aim to reduce duplicate reporting without limiting information needed for regulatory oversight.

The proposal does not introduce new cryptocurrency regulations. Digital asset policy remains on a separate CFTC track, with the agency’s inaugural Investment Advisory Committee meeting scheduled for August 20. The agenda includes discussions on crypto regulatory clarity, market integrity, customer protection and the development of a federal crypto market structure.

As Congress continues considering broader digital asset legislation, crypto-focused fund managers remain subject to existing CFTC requirements and other applicable federal and state regulations.