How to Launch a Crypto VC Fund: Legal Requirements and Structure (2026)

At a minimum, launching a crypto VC fund requires five things: the fund and management entities (typically a Delaware limited partnership, a general-partner LLC, and a management-company LLC); a private-offering exemption for the fund interests (Reg D Rule 506(b) or 506(c)); an Investment Company Act exclusion (Section 3(c)(1) or 3(c)(7)); a determination of your investment-adviser status (most sub-$150 million managers file as exempt reporting advisers); and a CFTC commodity-pool analysis if the fund trades crypto derivatives. The threshold question that shapes the rest: are the assets the fund holds securities, commodities, or both?

Launching a fund that invests in cryptocurrency begins from the same place as any venture fund: entities, an offering exemption, an Investment Company Act exclusion, an investment-adviser analysis, and a service-provider stack. If you are forming a conventional venture fund, our complete venture-fund formation guide walks through that skeleton in detail, and most of it applies to a crypto fund unchanged.

What a crypto fund adds is an overlay. Four questions that are simple for an equities or a traditional VC fund become the hard part of a crypto fund, and they all trace back to one threshold issue: are the assets your fund holds securities, commodities, or both? That single answer cascades into whether you need an Investment Company Act exemption, whether managing the fund makes you an investment adviser, and whether the CFTC’s commodity-pool rules reach you. This guide covers that overlay—what changes, and why—and links back to the general guide for the mechanics that do not change.

Key takeaways

• A crypto fund is built on the standard fund skeleton. Delaware LP + GP + management company, a Reg D private offering, an Investment Company Act exclusion, and an adviser analysis—the same as any venture fund. The crypto-specific work is an overlay, not a different system.
• One threshold question drives everything: security or commodity? Whether the fund’s holdings are securities (most tokens can be) or commodities (Bitcoin and Ether are generally treated this way) determines which regulators reach the fund.
• The fund interests are securities. Whatever the fund holds, the limited-partnership interests you sell to passive investors satisfy the Howey test and are securities, so you always need a private-offering exemption (Reg D 506(b) or 506(c)).¹
• Most managers are exempt reporting advisers, not registered advisers. The private-fund exemption (Advisers Act § 203(m)) covers managers under $150 million; the venture-capital exemption (§ 203(l)) is harder for token-heavy strategies to fit.²
• Custody is the hardest operational problem. The Advisers Act custody rule reaches only advisers registered or required to be registered, so a typical exempt reporting adviser sits outside it,³ but the qualified-custodian universe for digital assets is narrow, and LP diligence and the annual audit drive the custody choice in practice.
• The CFTC matters only if you trade derivatives. Spot-only crypto funds generally avoid commodity-pool registration; funds trading crypto futures or swaps generally do not.

The crypto VC fund requirements at a glance

Five requirements, the controlling law behind each, and the usual path a crypto fund takes:

Start here: are your fund’s assets securities, commodities, or both?

Every other question in this guide depends on this one. The test is the Supreme Court’s Howey standard: an asset is an “investment contract”—and therefore a security—when there is an investment of money in a common enterprise with profits to come solely from the efforts of others.⁴ Howey is the durable law, and it is what ultimately governs.

On the commodity side, a federal court has held that virtual currencies are “commodities” within the Commodity Exchange Act, which brings them within the CFTC’s jurisdiction as commodities; the court was explicit that this jurisdiction is concurrent with, not exclusive of, other agencies’ authority.⁵

In March 2026, the SEC issued an interpretation, with CFTC guidance published beside it—Release No. 33-11412 / 34-105020 (SEC File No. S7-2026-09, published March 23, 2026)—that sorts crypto assets into five categories⁶ (digital commodities, digital collectibles, digital tools, stablecoins, and digital securities), describes Bitcoin and Ether as non-security “digital commodities,” and recognizes that a non-security token first sold under an investment contract can later cease to be subject to that investment contract once the issuer has fulfilled the essential managerial efforts it promised. Two cautions matter for a fund: this is interpretive guidance, not a binding rule—the SEC says it may refine, revise, or expand the interpretation, and the release itself states that it does not supersede or replace the Howey test, which is binding precedent—so it reflects current regulatory posture rather than settled law;⁷ and even where a token is not a security on receipt, a particular secondary-market sale can still be a securities transaction. Treat the release as the regulators’ current direction, confirm the position before relying on it, and analyze each asset under Howey.

Why this is the master switch: if your fund holds non-security commodities (Bitcoin, Ether), those assets are not “securities” for the Investment Company Act, advising on them is not advising on “securities” for the Advisers Act, and they fall under CFTC jurisdiction. If your fund holds tokens that are securities (or token rights still attached to a live investment contract), all three securities-law regimes re-attach. Most real crypto funds hold a mix—which is why the conservative structuring below assumes both.

The entity structure: what legal entity for a crypto VC fund?

The structure is the same three-entity stack used for any U.S. venture fund: a Delaware limited partnership (the fund that investors subscribe into), a Delaware general-partner LLC (the carry vehicle owned by the founders), and a management-company LLC (the fee vehicle that employs the team and holds any adviser registration). Delaware is the default formation jurisdiction regardless of where the managers sit, for the same reasons it is for conventional funds—tested LP and LLC statutes⁸ and the Court of Chancery. Our venture-fund guide covers the operating-agreement mechanics for each entity.

Two structural decisions take on a crypto-specific edge:

Onshore vs. offshore (the master-feeder question). If the fund expects non-U.S. investors or U.S. tax-exempt investors (endowments, foundations, pension plans), the standard solution is a master-feeder: an offshore master fund, a U.S. limited-partnership feeder for U.S. taxable investors, and an offshore “blocker” corporation feeder for non-U.S. and tax-exempt investors that blocks unrelated business taxable income (UBTI) from flowing through.⁹ Crypto sharpens this: whether staking rewards, fork income, and active token trading generate UBTI for tax-exempt investors is, in the firm’s assessment, unsettled, which pushes tax-exempt LPs toward a blocker more strongly than in a conventional fund. The related § 864(b) trading safe harbor for an offshore vehicle is also uncertain as applied to crypto, precisely because the statute states one safe harbor for trading in stocks or securities and a separate one for trading in commodities, and so turns on which a given digital asset is.¹⁰ These are tax-counsel questions—flag them early, because they drive the structure.

Custody and banking. Crypto funds face a narrower qualified-custodian universe (see below) and historically tighter banking access for fiat on- and off-ramps. Those operational realities can influence entity domicile and the choice of administrator and auditor, so they belong in the structuring conversation rather than after it.

Raising the fund: Reg D 506(b) vs. 506(c)

Whatever the fund holds, the interests you sell to passive investors satisfy the Howey test and are securities,¹ so the capital raise needs a private-offering exemption. The two standard paths are the same as for any fund:

• Rule 506(b) bars general solicitation (no public marketing of the offering) but imposes no verification method for accredited status and permits up to 35 purchasers who are not accredited investors, each of whom must be sophisticated. It suits managers with an existing investor network.¹¹
• Rule 506(c) permits general solicitation—public posts, a website, conferences—but every investor must be accredited and the issuer must take reasonable steps to verify. In a March 2025 no-action letter, the SEC’s Division of Corporation Finance agreed that an issuer could reasonably conclude it has taken reasonable steps to verify where it requires a minimum investment of at least $200,000 per natural person or $1,000,000 per entity, with written representations that the purchaser is accredited and that the minimum investment amount is not financed by a third party for the specific purpose of making the investment, and the issuer has no actual knowledge of facts indicating otherwise; the staff letter has no legal force, but it makes 506(c) practical at typical fund minimums.¹²

After the first sale, file a Form D notice with the SEC within 15 calendar days and make the notice filings that states may require for covered securities sold to their residents.¹³ The mechanics—verification methods, the Marketing Rule overlay for registered advisers, and state filings—are the same as for a conventional fund and are covered in the venture-fund guide.

The Investment Company Act: do you need a § 3(c)(1) or § 3(c)(7) exclusion?

The Investment Company Act would normally regulate a pooled investment vehicle as an “investment company.” The definition that matters most here is the 40% test: an issuer engaged in the business of investing, holding, or trading in securities is an investment company if it owns or proposes to acquire “investment securities” worth more than 40% of its total assets, measured on an unconsolidated basis and excluding cash items and government securities.¹⁴ “Investment securities” means securities, with three narrow exclusions; an asset that is not a “security” under the Act’s definition is not an investment security and does not count toward the 40%.¹⁴

Here the threshold question returns. Non-security crypto (Bitcoin, Ether) is not an “investment security,” so a fund holding only non-security commodities can fall outside the 40% test. But most crypto funds also hold security-status tokens, token rights (SAFTs or pre-launch rights), or portfolio-company equity—all of which are investment securities. Once those exceed 40% of assets, the fund is an investment company and needs an exclusion. Because token classification is unsettled and a single re-characterized holding can flip the math, the standard practice is to structure to an exclusion regardless of the mix:

• § 3(c)(1)—a privately offered fund with no more than 100 beneficial owners (250 for a qualifying venture capital fund, one with no more than $10 million in aggregate capital contributions and uncalled commitments).¹⁵ The common choice for emerging-manager funds.
• § 3(c)(7)—a privately offered fund held solely by “qualified purchasers” (generally $5 million in investments for a natural person, $25 million for a person investing for its own account or other qualified purchasers’ accounts).¹⁶ No investor-count cap, used to scale into an institutional LP base.

The choice and the conversion timing work the same as for a conventional fund (see the venture-fund guide).

Investment-adviser status—and the digital-asset custody problem

When you are an adviser. The Investment Advisers Act reaches a person who, for compensation, engages in the business of advising others about securities.¹⁷ A manager advising solely on non-security crypto (a pure Bitcoin/Ether fund) may fall outside the federal Act—but two cautions apply: most crypto funds hold some security-status tokens or equity, which re-triggers the Act; and state adviser law, or the CFTC’s commodity-trading-advisor rules, may apply even where the federal Advisers Act does not.

Which exemption. Once you are advising on securities, most crypto VC managers avoid full registration through one of two exempt-reporting-adviser paths:

• Private-fund exemption—§ 203(m). Available to a manager that acts solely as an adviser to private funds and has under $150 million in U.S. assets under management.¹⁸ This is the workhorse for crypto funds.
• Venture-capital exemption—§ 203(l). Available to advisers solely to “venture capital funds,” with no AUM cap, but the definition (Rule 203(l)-1) caps assets other than qualifying investments, essentially equity of operating portfolio companies, and short-term holdings at 20% of the fund’s aggregate capital contributions and uncalled commitments.¹⁹ A crypto fund whose thesis is direct token holdings or liquid crypto generally cannot fit inside that 20% basket and falls back to § 203(m); a fund that genuinely invests in equity of blockchain operating companies (with tokens as a minority sleeve in the 20% basket) may fit § 203(l).

Both paths require reports on Form ADV filed electronically through IARD, and a California-based manager relying on the state’s private fund adviser exemption files the same reports with the Commissioner; the venture-fund guide covers the filing mechanics.²⁰

The custody problem. This is the operational issue most specific to crypto. The Advisers Act custody rule (Rule 206(4)-2) requires a registered adviser with custody of client funds or securities to keep them with a “qualified custodian”—banks and savings associations, registered broker-dealers, registered futures commission merchants, and certain foreign financial institutions.²¹ For digital assets, the qualified-custodian universe has historically been narrow. Self-custody of client crypto that is a fund or a security, and that fits none of the rule’s exceptions, does not comply; and the SEC’s own reading in its 2023 proposal was that most crypto assets trade on platforms that are not qualified custodians, so pre-funding trades on such a platform would generally put a registered adviser with custody of a crypto asset security in violation of the current rule.²² The SEC proposed a broader “safeguarding rule” in 2023 that would have extended custody requirements to client assets beyond funds and securities, crypto included, but withdrew that proposal in June 2025, stating that it does not intend to issue a final rule, which leaves Rule 206(4)-2 as the operative rule.²³ Confirm the current position on which digital-asset custodians qualify before relying on a particular arrangement. One structural point softens this for many emerging managers: the custody rule applies to an adviser registered or required to be registered, so an exempt reporting adviser is not subject to it,³ and for a typical sub-$150 million crypto fund relying on § 203(m), LP diligence, the annual audit, and the manager’s fiduciary duty—rather than Rule 206(4)-2 itself—drive the custody choice.

The CFTC question: are you a commodity pool operator?

Because Bitcoin and Ether are commodities, a crypto fund can fall under the CFTC’s commodity-pool regime—but only if it trades commodity interests, meaning futures, security futures, swaps, commodity options, and the other transactions the Act’s commodity-pool definition enumerates.²⁴ The distinction is sharp:

• A fund that holds only spot crypto (buying and holding Bitcoin or Ether) generally trades no commodity interests, so the manager is generally not a commodity pool operator,²⁴ and the registration requirement does not reach it.²⁵ The CFTC’s authority over spot crypto runs through enforcement instead: it may sue to enjoin violations of the Act, and it has not attempted to regulate spot trades absent fraud or manipulation.²⁶
• A fund that trades crypto futures, swaps, or perpetuals (for example, CME bitcoin futures) is generally a commodity pool, making the manager a commodity pool operator (CPO)—and possibly a commodity trading advisor—required to register with the CFTC unless an exemption applies.²⁵

The most common exemption is the de minimis exemption in CFTC Rule 4.13(a)(3). It is available where the pool’s commodity-interest positions stay within either a 5%-of-liquidation-value margin-and-premium limit or a 100%-of-liquidation-value net-notional limit, the interests are exempt from Securities Act registration and marketed publicly, if at all, only under Rule 506(c) or Rule 144A, the operator reasonably believes each participant is an accredited investor, a knowledgeable employee, a qualified eligible person, or a qualifying family trust, and the pool is not marketed as a vehicle for trading commodity futures or options. A notice of exemption is filed electronically with the NFA no later than the time a subscription agreement is delivered to a prospective participant.²⁷ A fund that exceeds the de minimis thresholds and registers can still reduce its disclosure and reporting burden under Rule 4.7 for pools sold only to qualified eligible persons.²⁸ The CFTC’s commodity-pool exemption landscape has continued to shift—including 2024 amendments to Rule 4.7 that doubled the Portfolio Requirement thresholds in the qualified-eligible-person definition and permitted monthly account statements for certain funds of funds, while declining the proposed minimum disclosure requirements, and December 2025 staff no-action relief for SEC-registered advisers to QEP-only pools—so confirm the current exemptions, thresholds, and figures before relying on them.²⁹

Minimum requirements, cost, and first steps

The minimum to launch a crypto VC fund is the three-entity Delaware stack (a limited partnership, a general-partner LLC, and a management-company LLC), a Reg D private offering for the fund interests, an Investment Company Act exclusion (§ 3(c)(1) or § 3(c)(7)), an investment-adviser determination (most emerging managers file as exempt reporting advisers rather than registering), a custody arrangement for the digital assets (a qualified custodian where the custody rule reaches the manager, and one investors will accept in any case), and a CFTC commodity-pool analysis if the fund will trade derivatives. Each is detailed in the sections above; none is optional, and the order in which you resolve them matters.

A first-time crypto fund carries the same baseline legal and setup costs as a conventional venture fund—entity formation, fund documents, and a service-provider stack—plus added cost for the custody arrangement, the security-vs-commodity analysis of the target portfolio, and any CFTC or offshore-blocker work. The venture-fund guide includes a cost breakdown and an interactive economics calculator that apply directly.

What to do first, in order: (1) map your intended portfolio and run the security-vs-commodity analysis, because it determines everything downstream; (2) choose the Investment Company Act exclusion and the investor profile that follows from it; (3) settle the adviser exemption and whether the venture-capital exemption is even available to your strategy; (4) line up a qualified custodian early, because custody constrains structure and timing; and (5) run the CFTC analysis if derivatives are in the plan. Each of these is a question to resolve with counsel before documents are drafted, not after.

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This article provides general information only and is not legal advice. Securities, commodities, investment-adviser, and tax requirements for crypto funds are complex, fact-specific, and changing—several of the positions described here (including the March 2026 SEC/CFTC interpretive guidance and current digital-asset custody practice) are recent or unsettled and should be confirmed against the controlling statute, rule, or regulator guidance before you rely on them. Whether and how any requirement applies to a particular fund is a determination to make with qualified counsel. Attorney Advertising.

Work with Astraea Counsel

Astraea Counsel advises emerging and institutional fund managers on fund formation, securities exemptions, investment-adviser registration, and digital-asset structuring. Explore our Fund Formation services or contact us to discuss launching your fund.

Related resources

• How to Start a Venture Fund: The Complete Decision Guide—the full fund-formation framework, with an interactive economics calculator
• State-by-State Crypto Licensing Map: 2026 Requirements Guide—when crypto activity requires a state money-transmitter license
• Regulatory Compliance Practice—navigating state and federal requirements

Footnotes

1. 15 U.S.C. § 77b(a)(1) (the term “security” includes an “investment contract”); SEC v. W.J. Howey Co., 328 U.S. 293, 298-299 (1946). PDF PDF ↩ ↩²

2. 15 U.S.C. § 80b-3(l), (m)(1); 17 C.F.R. §§ 275.203(l)-1, 275.203(m)-1. PDF PDF PDF ↩

3. 17 C.F.R. § 275.206(4)-2(a) (the rule applies “[i]f you are an investment adviser registered or required to be registered under section 203 of the Act”). PDF ↩ ↩²

4. SEC v. W.J. Howey Co., 328 U.S. 293, 298-299 (1946) (an investment contract is “a contract, transaction or scheme whereby a person invests his money in a common enterprise and is led to expect profits solely from the efforts of the promoter or a third party”). PDF ↩

5. CFTC v. McDonnell, 287 F. Supp. 3d 213, 228 (E.D.N.Y. 2018) (“Virtual currencies can be regulated by CFTC as a commodity.”; the CFTC’s authority “does not preclude other agencies from exercising their regulatory power”); 7 U.S.C. § 1a(9) (defining “commodity” to include “all other goods and articles … in which contracts for future delivery are presently or in the future dealt in”). PDF PDF ↩

6. Application of the Federal Securities Laws to Certain Types of Crypto Assets and Certain Transactions Involving Crypto Assets, Release Nos. 33-11412; 34-105020, 91 Fed. Reg. 13714 (Mar. 23, 2026) (classifying crypto assets as digital commodities, digital collectibles, digital tools, stablecoins, and digital securities; listing Bitcoin and Ether among the examples of digital commodities; and addressing how a non-security crypto asset may cease to be subject to an investment contract once the issuer has fulfilled the essential managerial efforts it represented or promised). PDF ↩

7. 91 Fed. Reg. at 13716 (the Commission “may refine, revise, or expand upon the interpretation”; the interpretation “does not supersede or replace the Howey test, which is binding legal precedent”). PDF ↩

8. 6 Del. C. § 17-201(a) (a limited partnership is formed by executing and filing a certificate of limited partnership with the Secretary of State); 6 Del. C. § 18-201(a) (a limited liability company is formed by filing a certificate of formation). PDF PDF ↩

9. 26 U.S.C. § 512(a)(1) (unrelated business taxable income is the gross income from an unrelated trade or business regularly carried on, less directly connected deductions); 26 U.S.C. § 513(a) (defining “unrelated trade or business”). PDF PDF ↩

10. 26 U.S.C. § 864(b)(2)(A) (trading in stocks or securities), (B) (trading in commodities, limited by clause (iii) to commodities “of a kind customarily dealt in on an organized commodity exchange and if the transaction is of a kind customarily consummated at such place”). PDF ↩

11. 17 C.F.R. § 230.506(b)(1) (the offering must satisfy §§ 230.501 and 230.502), (b)(2)(i) (no more than 35 purchasers in any 90-calendar-day period), (b)(2)(ii) (each non-accredited purchaser must have the knowledge and experience to evaluate the investment); 17 C.F.R. § 230.501(e) (accredited investors are excluded from the purchaser count); 17 C.F.R. § 230.502(c) (no general solicitation or general advertising). PDF PDF PDF ↩

12. 17 C.F.R. § 230.506(c)(2)(i)-(ii) (all purchasers accredited; the issuer “shall take reasonable steps to verify”); SEC Division of Corporation Finance, No-Action Letter to Latham & Watkins LLP (Mar. 12, 2025) (responding to an incoming letter dated Mar. 6, 2025 that proposed minimum investment amounts of at least $200,000 for natural persons and $1,000,000 for legal entities with written representations that the purchaser is an accredited investor and that the minimum investment amount is not financed by a third party for the specific purpose of making the investment, the issuer having no actual knowledge of facts indicating otherwise: “we agree the issuer could reasonably conclude that it has taken reasonable steps to verify that purchasers of securities sold in an offering under Rule 506(c) of Regulation D are accredited investors”; the letter “has no legal force or effect”). PDF PDF PDF ↩

13. 17 C.F.R. § 230.503(a) (Form D filed “no later than 15 calendar days after the first sale of securities in the offering”); 15 U.S.C. § 77r(c)(2)(A) (a State may require the filing of any document filed with the Commission, “solely for notice purposes and the assessment of any fee”). PDF PDF ↩

14. 15 U.S.C. § 80a-3(a)(1)(C) (an issuer that “is engaged or proposes to engage in the business of investing, reinvesting, owning, holding, or trading in securities, and owns or proposes to acquire investment securities having a value exceeding 40 per centum of the value of such issuer’s total assets (exclusive of Government securities and cash items) on an unconsolidated basis”), (a)(2) (“investment securities” includes all securities except Government securities, securities issued by employees’ securities companies, and securities of certain majority-owned subsidiaries); 15 U.S.C. § 80a-2(a)(36) (defining “security”). PDF PDF ↩ ↩²

15. 15 U.S.C. § 80a-3(c)(1) (an issuer whose outstanding securities are beneficially owned by not more than one hundred persons, or 250 for a qualifying venture capital fund, and which is not making and does not propose to make a public offering), (c)(1)(C)(i) (a “qualifying venture capital fund” is a venture capital fund with “not more than $10,000,000 in aggregate capital contributions and uncalled committed capital,” indexed for inflation every five years). PDF ↩

16. 15 U.S.C. § 80a-3(c)(7)(A); 15 U.S.C. § 80a-2(a)(51)(A)(i) (a natural person who owns not less than $5,000,000 in investments), (A)(iv) (a person who, for its own account or other qualified purchasers’ accounts, owns and invests on a discretionary basis not less than $25,000,000 in investments). PDF PDF ↩

17. 15 U.S.C. § 80b-2(a)(11) (“investment adviser” means any person who, for compensation, engages in the business of advising others as to the value of securities or the advisability of investing in, purchasing, or selling securities). PDF ↩

18. 15 U.S.C. § 80b-3(m)(1) (exemption for an adviser that “acts solely as an adviser to private funds and has assets under management in the United States of less than $150,000,000”); 17 C.F.R. § 275.203(m)-1(a). PDF PDF ↩

19. 15 U.S.C. § 80b-3(l); 17 C.F.R. § 275.203(l)-1(a)(2) (immediately after acquiring any asset other than qualifying investments or short-term holdings, the fund holds no more than 20 percent of aggregate capital contributions and uncalled committed capital in non-qualifying investments), (c)(3) (defining “qualifying investment”). PDF PDF ↩

20. 17 C.F.R. § 275.204-4(a)-(b) (an adviser relying on § 203(l) or (m) “must complete and file reports on Form ADV” and “must file Form ADV electronically with the Investment Adviser Registration Depository (IARD)”); Cal. Code Regs. tit. 10, § 260.204.9(b)(2), (f) (a private fund adviser exempt from the California certificate requirement files with the Commissioner each report it must file with the SEC under Rule 204-4, electronically through the IARD). PDF PDF ↩

21. 17 C.F.R. § 275.206(4)-2(a)(1) (a qualified custodian maintains the client funds and securities), (d)(6) (defining “qualified custodian”). PDF ↩

22. Safeguarding Advisory Client Assets, Release No. IA-6240, 88 Fed. Reg. 14672, 14689 (Mar. 9, 2023) (proposed rule, since withdrawn) (“Because we understand that most crypto assets, including crypto asset securities, trade on platforms that are not qualified custodians, this practice would generally result in an adviser with custody of a crypto asset security being in violation of the current custody rule … .”); 17 C.F.R. § 275.206(4)-2(b)(2) (the privately offered securities exception, available for securities held for the account of a pooled investment vehicle “only if the limited partnership is audited, and the audited financial statements are distributed, as described in paragraph (b)(4)”). PDF PDF ↩

23. Safeguarding Advisory Client Assets, Release No. IA-6240, 88 Fed. Reg. 14672 (Mar. 9, 2023) (proposed rule); Withdrawal of Proposed Regulatory Actions, Release Nos. 33-11377; 34-103247; IA-6885; IC-35635, 90 Fed. Reg. 25531, 25531-25532 (June 17, 2025) (withdrawing the safeguarding proposal among others; the Commission “does not intend to issue final rules with respect to these proposals”). PDF PDF ↩

24. 7 U.S.C. § 1a(10)(A) (a “commodity pool” is an enterprise “operated for the purpose of trading in commodity interests,” including any commodity for future delivery, security futures product, or swap; any “agreement, contract, or transaction described in section 2(c)(2)(C)(i) or section 2(c)(2)(D)(i)”; commodity options authorized under § 4c; and leverage transactions authorized under § 19), (11)(A) (defining “commodity pool operator”). PDF ↩ ↩²

25. 7 U.S.C. § 6m(1) (it is unlawful for a commodity pool operator, “unless registered under this Act,” to use the mails or interstate commerce in connection with its business as such); 7 U.S.C. § 1a(12)(A) (defining “commodity trading advisor”); 17 C.F.R. § 4.13(a) (exemptions from registration as a commodity pool operator). PDF PDF PDF ↩ ↩²

26. CFTC v. McDonnell, 287 F. Supp. 3d 213, 227-229 (E.D.N.Y. 2018) (the CFTC “does not have regulatory authority over simple quick cash or spot transactions that do not involve fraud or manipulation” and “has not attempted to regulate spot trades, unless there is evidence of manipulation or fraud,” but has standing under 7 U.S.C. § 13a-1 to seek relief for fraud and misappropriation involving virtual currencies traded in spot markets); 7 U.S.C. § 13a-1(a) (the Commission may sue to enjoin any act or practice constituting a violation of the Act). PDF PDF ↩

27. 17 C.F.R. § 4.13(a)(3)(i)-(iv), (b)(1)-(2). PDF ↩

28. 17 C.F.R. § 4.7. PDF ↩

29. Commodity Pool Operators, Commodity Trading Advisors, and Commodity Pools Operated: Updating the “Qualified Eligible Person” Definition; Adding Minimum Disclosure Requirements for Pools and Trading Programs; Permitting Monthly Account Statements for Funds of Funds; Technical Amendments, 89 Fed. Reg. 78793 (Sept. 26, 2024) (effective Nov. 25, 2024; adopting the doubled Portfolio Requirement thresholds of $4,000,000 in securities and other assets and $400,000 in initial margin and premiums, id. at 78799, with a Mar. 26, 2025 compliance date, id. at 78793; the Commission “is declining to finalize the proposed minimum disclosure requirements,” id. at 78806); CFTC Letter No. 25-50 (Dec. 19, 2025) (staff no-action relief for SEC-registered investment advisers to pools offered solely to qualified eligible persons, in the mold of former Rule 4.13(a)(4)). PDF PDF ↩