According to a report by The Block, Rostin Behnam, Chairman of the U.S. Commodity Futures Trading Commission (CFTC), once again urged legislators to take action and grant the agency new powers over the industry, as cryptocurrency-related issues are consuming CFTC’s resources.
Behnam stated during his testimony to the House Committee on Agriculture on Wednesday, the 6th of October, that over 49% of CFTC’s enforcement actions in the 2023 fiscal year were related to digital assets, and the market is still growing. He emphasized that a market they do not directly regulate accounts for half of their enforcement cases, and it is not just the enforcement division’s resources that are being consumed, “we need experts from different departments to collaborate on cases.”
Behnam also highlighted the recent growth in cryptocurrency values and the optimism of retail investors, which he referred to as a “warning event,” and reiterated the necessity of a regulatory framework, stating, “This is not about legitimizing the technology, this is about protecting the American public and investors.”
In July last year, the House Committee on Agriculture and the House Financial Services Committee jointly pushed for the passage of the “21st Century Financial Innovation and Technology Act,” which would give more responsibilities to CFTC and provide guidance for the transition of digital assets from securities investments to commodities. However, due to a lack of necessary support, the likelihood of the bill being passed and sent to the U.S. President’s desk is minimal.
Several legislators inquired during the hearing on Wednesday whether CFTC would be capable of implementing its regulatory framework quickly if the bill were to advance. Behnam stated that the agency would need a year’s time, while also adding that the recent record-high price of Bitcoin highlights the need for action.
Regarding the question of whether Ethereum (ETH) is a security or a commodity, Behnam was also asked. He stated that Ethereum is a commodity, and the regulators at the Securities and Exchange Commission (SEC) have not given a clear indication on this matter.
Prior to this, cryptocurrency platform Prometheum received a special purpose broker-dealer license from the SEC last year and announced last month that its subsidiary, Prometheum Capital LLC, will provide custody services for Ethereum. Republican Congressman Zach Nunn from Iowa expressed concern on Wednesday, stating, “I am worried that the SEC will take advantage of this opportunity to bypass Congress or even the CFTC and further confuse the participants who have already entered this field.”
Behnam mentioned that he has not communicated with Prometheum, but he stated that providing custody for Ethereum is the company’s independent decision, not the SEC’s decision. Behnam said,
Successful Conclusion of CoinEx Taiwan’s 7th Anniversary Celebration, Embracing the Arrival of the Web3 Era Hand in Hand with Users
Since its establishment in 2017, CoinEx has been a professional cryptocurrency trading pla…