Rostin Behnam, Chairman of the U.S. Commodity Futures Buying and selling Fee (CFTC), emphasised the need for a transparent regulatory framework within the burgeoning cryptocurrency market throughout a current podcast interview with the Intercontinental Change (ICE) Aug. 14.
Expressing issues in regards to the business’s present ambiguity and vulnerability to potential fraud and manipulation, Behnam acknowledged, “The market appears to need some sort of regulatory framework.”
These feedback come as institutional curiosity in cryptocurrency is on the rise, and market contributors search readability. “You possibly can predict that institutional demand will seemingly enhance if there’s a clear regulatory framework,” he famous. Behnam’s emphasis was on establishments and particular person contributors who require threat hedging inside the crypto setting.
Commodities v. securities
Behnam has commented extensively on the cryptocurrency house prior to now, most notably to precise his view that many cash, together with Bitcoin and Ethereum, should be thought-about commodities.
Nonetheless, this place is considerably at odds with that of Securities and Change Fee (SEC) Chairman Gary Gensler, who beforehand talked about that the overwhelming majority of cryptocurrencies must be categorized as securities and are thus already underneath current securities legal guidelines. Behnam challenges this view, contending that about 70% of the crypto market must be categorised as commodities. He appealed to Congress to enact laws to supply clearer pointers on commodity tokens, bolstering the CFTC’s powers in overseeing this sector.
This isn’t the primary time the CFTC Chairman has waded into the crypto regulation debate. In a March 2023 listening to, Behnam declared digital belongings like Ethereum and sure stablecoins as commodities, difficult the SEC’s broader classification of cryptocurrencies as securities. This distinction between the 2 regulatory our bodies has lengthy been a matter of competition and can seemingly proceed to form the regulatory panorama of the cryptocurrency business.
For now, as institutional and particular person curiosity within the crypto market persists, the requires clearer, extra nuanced, and complete regulatory pointers develop louder.