- CFTC chair advocates for restructuring for better regulations
The US Commodity Futures Commission (CFTC) is set to restructure its operations to achieve proactiveness and become more comprehensive in regulations. The CFTC is the regulatory agency tasked with regulating the cryptocurrency market alongside the Securities and Exchange Commission (SEC).
In an announcement made on July 25, the CFTC Chair, Rostin Behnam, said some changes could come to the comission. Behnam announced that one of the changes will be LabCFTC. LabCFTC was described as the main point for the efforts of the CFTC to provide “responsible fintech innovation.”
Under these new changes, the CFTC will be known as the Office of Technology Innovation (OTI) and then send a report to the chairman’s office. While speaking at the Brookings Institute webinar, Behnam added that the regulator was now engaged in providing proactiveness and formulating a comprehensive regulatory framework.
The CFTC chair added that the core policy divisions were looking into how the CFTC could leverage its existing authority over the commodity and futures market and ensure that investors are protected by ample regulations.
Another change that will also be introduced by the CFTC is the launch of an Office of Customer Education and Outreach. This office will be joined together with the Office of Public Affairs. It will also serve the retail participants better within the market.
Behnam noted that the digital assets market was filled with many retail traders. This made digital assets different from the other commodities offered in the market. Behnam also pointed to the other studies by the CFTC showing the role retail investors play in the crypto market. These studies say that digital asset trading by retail participants equates to around “25% of long open interest in the Bitcoin futures market.”
Issues with regulations in the crypto market
Behman complained that regulators had a “collective analysis paralysis” over cryptocurrency regulations. Despite these limitations, financial technology has advanced significantly.
Behnam has also urged the CFTC to be given more authority to better regulate the cryptocurrency space. He has previously said that the agency failed in market surveillance and oversight authority.
Earlier this year, Behnam appeared before the Senate Agriculture Committee, saying that its overreliance on whistleblowers and tips was insufficient to monitor illegal activities. These tips were only a tip of what was happening in the market.
