Rostin Behnam, the acting chair of the CFTC, will reportedly be nominated in the near future to oversee crypto market
According to the latest information, Rostin Behnam will be appointed by President Joe Biden to be the U.S. Commodity Futures Trading Commission (CFTC). The question is when Behnam takes office, how will the crypto market be affected?
Biden reportedly chooses Rostin Behnam as new CFTC Chair to oversee crypto market
The CFTC has been inactive since Heath Tarbert’s departure in January. Behnam was appointed acting chairman of the CFTC in January, but he has yet to be nominated, let alone confirmed by the Senate. According to an unnamed source cited in the Bloomberg report, his nomination is expected to be officially announced in the coming weeks.
Rostin Behnam, the acting chair of the CFTC
As AZCoin News reported, cryptocurrency derivatives exchange BitMEX will pay $100 million in a settlement with the US authorities over allegations it broke CFTC and FinCEN rules by allowing Americans to trade on the platform.
In his statement, Behnam stressed the importance of adhering to a culture of compliance. “This case reinforces the expectation that the digital assets industry, as it continues to touch a broader pool of market participants, takes its responsibilities seriously in the regulated financial industry and its duties to develop and adhere to a culture of compliance,” he stated.
In March, the CFTC also slapped Coinbase with a $6.5 million fine for inaccurate reporting, but the case investigation predated Behnam’s time in office. He opined that the federal government should have a role in regulating the crypto market as it continues to see strong retail investor interest.
In the meantime, there are reports about a brewing turf war between the CFTC and the U.S. Securities and Exchange Commission (SEC) over cryptocurrency regulation.
Cryptocurrencies have received much heat in recent times as governments have tried to bring the runaway “wildcat” industry under regulation. US regulatory bodies, courts, and Congress brainstorm how to satisfy the public’s expectations concerning cryptocurrencies favorably.
While crypto regulation still has a long way to go before there is clarity in the sector, two regulatory bodies in the U.S seem to be engaged in a turf war as to who should have regulatory oversight over crypto-assets like Bitcoin, Ether, XRP,…
CFTC Commissioner fires back at SEC, affirms it has no authority over crypto
One of the five commissioners of the CFTC, Brian Quintenz, probably prompted by the recent comments of SEC Chair Gary Gensler, has stated that the SEC has no authority over cryptocurrencies.
“Just so we’re all clear here, the SEC has no authority over pure commodities or their trading venues, whether those commodities are wheat, gold, oil….or crypto assets,” Quintez stated.
He also points out, while suggesting that the SEC needs expanded powers, that most cryptocurrencies were offered as securities by the Howey test standard, adding that such actions especially exemplified in ICOs were harmful to investors as they were not always given complete information, left prices open to manipulation and investors vulnerable.
It remains unclear which cryptocurrencies are commodities and which are securities, hence the perceived scuffle. The CFTC is to have regulatory oversight over commodities while the SEC should have over securities. Notably, a recently proposed legislation has tried to define the asset class into two categories – crypto and digital asset security. While the efforts are encouraging, it will still be a long way off before there is a high degree of certainty as crypto-businesses overlap involvement in both kinds of crypto.
However, market observers and key players are worried that the measure the SEC is looking to adopt, should they be too strict, could stifle innovation and weigh negatively on sentiments in the crypto market or even go as far as driving crypto innovation offshore from the US.
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