Last week, the SEC and CFTC announced two requests for public comment on potential opportunities to:

– Further update, clarify, and harmonize certain derivatives product definitions and interpretive issues; and

– Harmonize, modernize, and streamline data reporting requirements in their regulation of the security-based swap and swap markets.

On definitions and interpretations, specific topics for public input include:

– Definitions relating to swaps and security-based swaps, including the scope of certain exclusions from the swap definition
– Treatment of mixed swaps
– Treatment of novel or emerging products
– Jurisdictional and interpretive questions
– Potential areas in need of greater clarity regarding regulatory definitional lines
– Potential areas for alternative compliance

For data reporting requirements, the joint request seeks input on:

– Harmonization across frameworks
– Transparency and data quality
– Operational complexity
– Standardized identifiers and reference data
– Implementation considerations

Both public comment periods will remain open for 60 days following publication of the request for comment in the Federal Register.

Harmonization of policies and practices between the SEC and the CFTC has been a focus of both agencies over the past year. The first big step toward harmonization was the signing of a historic Memorandum of Understanding to guide their coordination and collaboration, which Dave blogged about in March. A joint Interpretive Release clarifying the application of the securities laws to digital assets followed shortly thereafter. But these two requests for comment aren’t just about harmonization. As this Bloomberg article explains, they’re also about bringing regulatory predictability to prediction markets — especially as those markets look to expand into areas that would include securities.

– Meredith Ervine