"Bringing this market into the light ... can solely enable us to check what’s occurring beneath the hood," same Rostin Behnam.
Commodity Futures commerce Commission chair Rostin Behnam is wanting to members of Congress to handle the Commission’s lack of enforcement authority within the digital asset space.
At a Wednesday hearing titled “Examining Digital Assets: Risks, Regulation, and Innovation,” Behnam told lawmakers with the Senate Committee on Agriculture, Nutrition, and forestry that the CFTC’s authority was presently restricted to addressing fraud and themanipulation of digital assets while not a transparent regulative framework. The CFTC chair supplemental that as a result of there was presently a patchwork of regulation and social control authority across multiple government agencies, the majority of the agency’s actions taken within the last seven years “have for the most part relied on tips and whistleblowers” who brought crypto scams and different illicit activities to the CFTC’s attention.
“We have variety of exchange-traded derivatives on crypto assets on many registered CFTC exchanges, however the visibility to the underlying market is restricted at the most,” said Behnam. “In essence, this can be an unregulated market [...] there's such a lot that we tend to don't seem to be able to see because of this restricted authority.”
The CFTC chair added:
“We don’t have any of these very advanced tools to monitor markets so it’s giving us a very, very narrow lens into what is actually happening in the market. This is why I think as you contemplate more regulatory authority for the CFTC, bringing this market into the light so to speak with more transparency will only allow us to see what’s going on underneath the hood.”
Behnam, who served as acting chair of the CFTC since January 2021 before being confirmed by the Senate last month, has antecedently likened the govt. agency’s enforcement of the digital quality house to a beat cop on duty. With Behnam serving as chair, the CFTC has been a district of enforcement cases against crypto derivatives exchange BitMEX — within which the firm agreed to pay a $100 million civil financial penalty — and Tether and Bitfinex, that the commission fined $42.5 million in October.
“There is not any one regulator, either state or federal, with sufficient visibility into digital asset artefact trading activity to totally police conflicts of interest and deceptive trading practices impacting retail customers,” said Behnam in his written statement to the committee.
( Turner Wright, Cointelegraph, 2022)