CFTC Chairman Rostin Behnam informed Congress that we urgently want laws that may present clear regulation to the crypto business to make sure correct investor safety.
Behnam made the assertion throughout his testimony earlier than the Home Agriculture Committee on March 6, which primarily centered on the FTC’s fiscal 12 months 2025 funds request C.
Behnam stated:
“The concept that cryptocurrencies are going away is a false story.
He added that greater than 49% of CFTC lawsuits filed within the 12 months ending October 2023 concerned conduct associated to digital belongings, even supposing “no federal company retains direct regulatory authority” over the crypto business.
Framework for 12 months
Throughout the listening to, Behnam spoke in regards to the challenges and alternatives introduced by digital belongings reminiscent of Bitcoin (BTC) and Ethereum (ETH), which symbolize a good portion of the general crypto market capitalization.
He stated there’s a false impression amongst regulators and lawmakers that the significance of the digital asset market could diminish. Nonetheless, the earlier decade has proven that this isn’t the case because the demand for these belongings has grown exponentially throughout this time.
Behnam emphasised the necessity for proactive legislative measures to make sure a steady and clear regulatory setting. He added that defending traders ought to be the federal government’s prime precedence given the rising curiosity in digital belongings for the reason that starting of the 12 months.
Behnam stated that if Congress passes the Monetary Innovation and Know-how for the twenty first Century Act (FIT Act), the CFTC will take roughly 12 months to develop a complete regulatory framework for digital belongings.
The FIT Act, which handed the Home Agriculture and Monetary Providers Committees with out reaching a ground vote, goals to make clear regulatory obligations for digital belongings.
BTC, ETH are commodities
Behnam’s testimony additionally addressed questions from committee members in regards to the classification of digital currencies as commodities or securities, a distinction that has implications for regulatory jurisdiction.
In response to a query from MP John Duarte, Behnam defined that digital belongings are typically thought of commodities until they meet the standards to be categorized as securities, suggesting a differentiated method wanted to successfully regulate these belongings.
Behnam added that Bitcoin and Ethereum don’t meet the standards wanted to be categorized as securities, which routinely means they fall below the commodity umbrella, regardless of being extremely completely different from bodily commodities like gold or corn.
The CFTC chairman informed Duarte that there’s a enormous urge for food for bitcoin amongst retail and institutional traders, no matter whether or not the federal government desires to legitimize it or not.
Behnam admitted that regulators have tried to “shoe” cryptocurrencies into different frameworks and the business must be judged by itself.
