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CFTC Chair: Crypto Deserves Better Regulation, not 70-Year-Old Case Law
It’s not just rhetorical flourish when we’ve written that the government is trying to regulate the future with the tools of the past, and now the chairman of the the Commodity Futures Trading Commission (CFTC) said as much on CNBC Squawkbox.
CFTC Chairman Rostin Behnam talked about this and his disagreements with Securities and Exchange Commission Chair Gary Gensler over classifying crypto as either a security or a commodity, and said a new approach is needed as they are relying on 70-year-old case law in making determinations.
The crypto space in the United States and worldwide has called on governments for regulatory clarity, and it hasn’t gotten it. Behnam appeared to sympathize with this sentiment even as his CFTC has butted heads with the SEC.
“We have to rely on 70-year-old case law to determine what’s a security or a commodity. We have one case in New York that says Bitcoin is a commodity,” Behnam said when asked if BTC and Ether are securities.
Benham seemed said that digital assets have unique characteristics, as opposed to traditional risk assets.
“We’re trying to find a reasonable outcome that will create certainty for the market,” he said. “For us, the CFTC, the difficulty is: we are a derivatives regulator – we don’t oversee cash markets. So the authority that I’ve been asking Congress for is cash authority so that we can go into the Bitcoin cash market, the Ether cash market, and the other digital tokens.”
Gensler has said that he is in favor of Congress granting CFTC authority over Bitcoin, Ether and other digital assets that he considers non-securities, but the problem is there are very few assets that Gensler doesn’t see as non-securities, and this sets up a potential turf war over regulating crypto down the road.
Definitely worth the watch.