Last December, the NFA adopted new reporting requirements for member commodity pool operators (CPOs) and commodity trading advisors (CTAs) related to virtual currency. Separately, the CFTC published a proposed interpretation of the term “actual delivery” in the context of retail commodity transactions in virtual currency. These actions reflect the enhanced regulatory oversight of virtual currency against the backdrop of spectacular volatility in these products and the recent launch of futures contracts involving virtual currency products. In a guest article, Lawrence B. Patent, of counsel at K&L Gates, reviews the new NFA reporting requirements for CPOs and CTAs; the CFTC’s proposed interpretation of the term “actual delivery”; considerations for hedge fund managers seeking to invest in virtual currency; and the outlook for further regulatory action in this area. See our three-part series on blockchain and the private funds industry: “Basics of the Technology and How the Financial Sector Is Currently Employing It” (Jun. 1, 2017); “Potential Uses by Private Funds and Service Providers” (Jun. 8, 2017); and “Potential Impediments to Its Eventual Adoption” (Jun. 15, 2017). For additional insights from Patent, see our three-part CPO compliance series: “Conducting Business with Non-NFA Members (Bylaw 1101)” (Sep. 6, 2012); “Marketing and Promotional Materials” (Oct. 4, 2012); and “Registration Obligations of Principals and Associated Persons” (Feb. 7, 2013).