The heads of CFTC and SEC both started looking to expand their authority over regulating crypto assets, as we are going to look further in our latest cryptocurrency latest news today.
Acting CFTC chair Rostin Behnam urged the Senate committee to expand the authority of the agency over-regulating crypto. In the meantime, SEC Chair Gary Gensler started lobbying for more regulatory control over the stablecoins, and a few days after the reports emerged that the Treasury Department will give the Securities and Exchange Commission responsibility for regulating crypto, the sister agency will make a play to be the main player on the field for the entire crypto sector.
Rostin Behnam who is the acting chair of the Commodity Futures Trading Commission and President Biden’s nominee, requested the Senate Committee on Agriculture, Forestry, and Nutrition to give the CFTC more power to regulate the digital asset sector. Appearing before the committee as part of the confirmation hearing and Behnam even noted that the agency’s enforcement actions against BitMex and Tether prove the agency has all that it takes but added that this is only the tip of the iceberg due to the $2.6 trillion crypto market cap which he classified as commodities or basic goods that can be traded on exchanges.
“I think it’s important for this committee to…consider expanding authority for the CFTC. “I think it’s critically important to have a primary cop on the beat. And certainly, the CFTC is prepared to do that, if this committee so wishes.”
While he noted that this will certainly be a departure for the role as a derivatives regulator, he said that the growth of the sector and the risks to investors and financial stability. Also, SEC chair Gary Gensler lobbied the Treasury Department and the working group on financial markets for more authority over stablecoins, digital assets that are pegged to fiat. Gensler wanted to clarify the SEC has the power to oversee the tokens when they are involved in the investment transactions and went on to say that the Treasury Department was prepared to let the SEC take the lead on the stablecoin market while CFTC also plays a role.
The heads of CFTC and SEC were the main regulatory players in the crypto space with both filing overlapping roles. The latter is responsible for regulating the trading of securities assets which change hands with the expectations of future profits but refused to classify either BTC or ETH as the two biggest assets by market cap as securities. The CFTC referred to BTC as a commodity since 2015 but it doesn’t mean that it has the power to regulate crypto. The CFTC commissioner Dawn DeBerry Stump said that the agency is not in charge of regulating commodities but with regulating derivatives based on the commodities. Stump wrote:
“For a number of years, the CFTC has aggressively used its broader enforcement authority to deter manipulation and fraud involving cash digital assets, even though the CFTC does not regulate them.”