New Disclosure Requirements For NFA Members Engaging In Virtual Currency Activities—Action Required

On August 9, 2018, the National Futures Association ("NFA") announced that, effective October 31, 2018, NFA members are required to make additional disclosures in connection with their virtual currency activities in accordance with recently adopted Interpretive Notice 9073 (the "Interpretive Notice").¹ The Interpretive Notice applies not only to asset managers that use virtual currency derivatives, but also to asset managers that use spot market virtual currencies. The disclosure requirements apply to promotional materials, disclosure documents and other offering documents.

Pursuant to the Interpretive Notice, commodity pool operators ("CPOs") and commodity trading advisors ("CTAs") that are NFA members and trade spot virtual currencies or virtual currency derivatives (for example, futures, options on futures, and cleared swaps) will be required to carefully consider the risks arising from these activities and to customize their disclosure documents, offering