Rostin Benham, the Chairman of the Commodity Futures Trading Commission (CFTC), stated in an interview with Bloomberg’s Odd Lots podcast on May 18 that the agency does not have the legal authority to regulate cash crypto markets. Benham mentioned that the CFTC only has a limited authority to police cash markets if there is fraud or manipulation.
Protection of Investors
Despite this limitation, Benham made it clear that the CFTC will regulate the sector in other ways. He emphasized that it is his duty within the CFTC to protect investors, and he commented on various incidents in the crypto industry that occurred in 2022. Benham also mentioned that many cryptocurrency tokens are commodity financial assets and that the CFTC can apply regulations, notices, advisories, and enforcement actions.
Benham acknowledged that cryptocurrency presents new and novel issues, but he also stated that past approaches to policy can be applied to the asset class. He believes that the CFTC’s authority over the cryptocurrency sector and related markets is important, as it is one of two U.S. government agencies aiming to regulate the space alongside the U.S. Securities and Exchange Commission (SEC).
Regulation of Assets
Gary Gensler, the SEC Chair, has said that the CFTC should regulate certain assets as long as it does not override the SEC’s authority. On the other hand, Benham has said that the CFTC should regulate assets that are not considered securities.
The CFTC has limited authority to police cash crypto markets. However, it can apply regulations, notices, advisories, and enforcement actions to protect investors. The Chairman believes that the CFTC’s authority over the cryptocurrency sector and related markets is important. This is especially true as it is one of two U.S. government agencies aiming to regulate the space alongside the SEC. Benham also believes that past approaches to policy can be applied to cryptocurrency.