Comment Text:
While we applaud the CFTC’s historical focus on climate-related risks, the proposed guidance falls short of what is needed to address serious problems in the VCC market, problems that implicate the Commission’s mission to promote market integrity, prevent price manipulation and other market disruptions, protect customer funds, and avoid systemic risk. Thankfully, the VCC derivatives market is in its infancy, and there is still time for the Commission to enhance integrity in the underlying market before additional derivatives products with dubious underlying assets come to market. The attached comment letter details our concerns with the proposal as currently structured and offers our recommendation for ensuring only high-quality VCCs serve as the underlying in derivatives contracts.
