In a May 11 letter to the CFTC, OCC commented on the proposal by LedgerX LLC, d/b/a FTX US Derivatives ("FTX"), to offer margined derivatives contracts on cryptocurrencies directly to participants without the benefits of clearing through a futures commission merchant. While FTX styles its proposal as a request for amendment to its order of registration as a derivatives clearing organization ("DCO"), FTX’s proposal may be more fairly characterized as a request for exemption from clearing transactions in the manner contemplated by the DCO Core Principles, CFTC Regulations and international standards set forth in the PFMI Principles promulgated by CPMI and IOSCO. OCC shares the concerns expressed in the comment letters submitted by CCP12 and the World Federation of Exchanges and writes separately to emphasize its concern that FTX’s proposal would “hard fork” the proven central counterparty model in a manner that would lead to greater systemic risk and weaken investor protection.