SEC Mulls Lower Thresholds for Major Swap Dealer Regulations
Published Date: 5/4/2026
Notice
Summary
The SEC is reviewing who counts as a “security-based swap dealer” or a “major security-based swap participant,” which are fancy terms for big players in certain financial trades. They’re thinking about lowering the thresholds that decide who needs to follow stricter rules, but for now, the current higher limits stay until May 2028. If you’re involved in these trades, keep an eye out and share your thoughts by July 6, 2026!
Analyzed Economic Effects
6 provisions identified: 3 benefits, 2 costs, 1 mixed.
Possible Cut to De Minimis Thresholds
The SEC may lower the de minimis thresholds that decide who must register as a security-based swap dealer. The scheduled thresholds are $3,000,000,000 for credit default swaps and $150,000,000 for non-credit default swaps, and the Commission may by order implement those scheduled levels or propose different thresholds after considering public comments.
Phase-In Thresholds Extended to 2028
The Commission issued an order that continues to apply the higher phase-in de minimis thresholds of $8,000,000,000 for CDS and $400,000,000 for non-CDS until May 8, 2028. That means the current, larger thresholds remain in effect through May 8, 2028 unless the Commission acts earlier.
Numbers of Firms That Could Be Captured
Staff estimated that, if the scheduled $3 billion (CDS) and $150 million (non-CDS) thresholds had applied to 2024, a small group of additional market participants may have needed to register: four market participants with CDS activity between $3 billion and $8 billion plus three with CDS activity above $8 billion, and 21 market participants with non-CDS activity between $150 million and $400 million plus 60 with non-CDS activity above $400 million.
Exclusions Significantly Reduce Counted Activity
Staff found that exclusions from the SBSD definition materially reduce the notional amounts counted toward the de minimis thresholds: about $4.6 trillion (54%) of 2024 CDS new trade activity and about $1,041.0 trillion (23%) of 2024 non‑CDS new trade activity appeared eligible for one or more exclusions.
Non‑CDS New Trade Activity Dominates 2024
In 2024, staff found that over 99% of reported new trade activity in security-based swaps was non-credit-default-swap (non-CDS) activity. Staff reported about $4,621.4 trillion in total new trade activity for 2024, including approximately $8.6 trillion in CDS and approximately $4,612.8 trillion in non-CDS.
Public Comment Opportunity — July 6, 2026
The SEC invited public comments on the staff report, with a submission deadline of July 6, 2026. The Commission said it will consider those comments when deciding whether to end the phase-in or propose different thresholds.
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