It is clear that the Securities and Exchange Commission (SEC) are the key agency in US crypto regulation, but the role of other regulatory agencies in policy and practice remains largely undefined. One of the key additional agencies in the future regulation of the sector would appear to be the Commodity Futures Trading Commission (CFTC), who have become increasingly outspoken about activities in the fast-growing sector. At yesterday’s hearing with the House Agricultural Committee, CFTC Commissioner J. Christopher Giancarlo brought some much needed clarity to a number of issues regarding crypto, blockchain and the oversight of retail markets in the US.
Earlier this month the CFTC issued yet another warning to consumers about the potential dangers of investing in initial coin offerings (ICOs) and other high risk digital assets. It seems the agency have an increasing input in an advisory role, and that they in addition play an important part in policing “bad actors” in the crypto space. Giancarlo confirmed yesterday, however, that the agency will not be taking a lead in the actual regulation of crypto trading markets. He commented that it is “not the historical role” of the CFTC to oversee retail markets such as crypto, and that the agency is designed primarily to ensure compliance with regulatory policy in futures markets.
Giancarlo also asserted that crypto markets as they stand are simply not large enough to constitute significant involvement from the agency. He said that since the value of the entire crypto market is “probably less than one big publicly traded company”, he felt an appropriate regulatory response at this early stage might be characterized as “first, do no harm.” He said he felt prioritizing mainstream financial markets which account for many trillions of dollars makes sense, and that regulators “are moving at a pace that is reasonable for an asset class that is developing rapidly but is still very small.”
CONNECT WITH CRYPTO TRADERS
