The Commodity Futures Trading Commission (CFTC) has notified Congress of its plans to regulate the crypto market with “full oversight capabilities” when proposed digital commodities consumer protection legislation goes into effect. The regulator claims to have the right experience and expertise and believes that “many digital assets are commodities.” In the meantime, SEC Chairman Gary Gensler has insisted that the vast majority of crypto tokens are securities.
CFTC Chairman’s Statement on Crypto Regulation and the Digital Commodities Consumer Protection Act
Commodity Futures Trading Commission (CFTC) Chairman Rostin Behnam discussed how his agency would regulate the crypto market in a legislative hearing Thursday before the U.S. Senate Committee on Agriculture, Food and Forestry.
The purpose of the hearing was to review the Digital Commodities Consumer Protection Act (DCCPA), which aims to empower the CFTC “with exclusive jurisdiction over the digital commodities cash market.” The bipartisan bill was introduced to the US Senate in August by Senators Debbie Stabenow (D-MI), John Boozman (R-AR), Cory Booker (D-NJ) and John Thune (R-SD).
Behnam told lawmakers:
Many digital assets represent commodities… The CFTC’s expertise and experience make it the right regulator of the digital asset market.
He explained that his agency “facilitates client protection through its principles-based market surveillance and disclosure regime designed to ensure transparency, integrity and security of transactions.”
Behnam went on to say that since 2014, the CFTC has prosecuted nearly 60 cases involving digital assets, including a recent matter involving a $1.7 billion bitcoin fraudulent scheme.
“Given the lack of full visibility of the digital commodity asset market, the agency’s enforcement program has had to rely primarily on leads and complaints from the public to detect fraud and manipulation,” the CFTC chair described, adding:
While we are making extensive efforts across the Agency to oversee these markets and their participants using the tools currently available to us, the DCCPA will allow us to apply all of our oversight capabilities without limitations.
Chairman Behnam concluded that “with the additional resources provided by the funding mechanism in the DCCPA, and the clear mandates for client education, outreach and intelligence gathering to ensure our efforts reach all demographics of the investment community, … the CFTC.” intervene quickly to enforce this new regime.”
Meanwhile, two more bills were introduced in Congress this year to make the CFTC the primary regulator of crypto spot markets. The Responsible Financial Innovation Act was introduced in June by US Senators Cynthia Lummis (R-WY) and Kristen Gillibrand (D-NY). The other bill was the Digital Commodity Exchange Act of 2022, introduced in April by MPs Ro Khanna (D-CA), Glenn “GT” Thompson (R-PA), Tom Emmer (R-MN) and Darren Soto was (D-FL).
Meanwhile, SEC Chairman Gary Gensler has repeatedly stated that the vast majority of crypto tokens are securities and should fall under the purview of his agency. However, he acknowledged that Bitcoin is a commodity. Last week, US Senator Pat Toomey said Congress should step in with crypto policies and the SEC should provide much more clarity on how it regulates the crypto sector.
Do you think the CFTC should be the primary regulator of the crypto market? Let us know in the comment section below.
photo credit: Shutterstock, Pixabay, WikiCommons
Disclaimer: This article is for informational purposes only. It is not a direct offer, or a solicitation of an offer to buy or sell, or a recommendation or endorsement of any product, service, or company. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.