Designated contract market

US

Designated contract market (DCMs) are defined in Section 5 of the Commodity Exchange Act (CEA), as "boards of trade (or exchanges) that operate under the regulatory oversight of the CFTC". DCMs are most like traditional futures exchanges, which may allow access to their facilities by all types of traders, including retail customers. They may list for trading futures or option contracts based on any underlying commodity, index or instrument.

Under the Dodd-Frank legislation, DCMs are one of two types of "exchange" on which mandatory cleared swaps may be traded. The other type of exchange is a swap execution facility (SEF). The intention of the legislation is to move what were bilateral derivative contracts on to the two types of exchange that enable participants to execute or to trade swaps with other market participants - so called "many to many" functionality.

Unlike SEFs, DCMs may trade with persons/legal entities with a net worth of less than USD 10 m.