Lawmakers: CFTC Must Pay Closer Attention to Crypto

US Cryptocurrency

U.S. lawmakers on both sides of the political aisle want the Commodity Futures Trading Commission to do more to control cryptocurrencies, according to a Bloomberg report Wednesday (Jan. 12). 

In its letter to the commission chairman, Democrats and Republicans on the Senate and House Agriculture Committees say the watchdog has a “critical role to play” when it comes to keeping digital currencies from being abused or becoming involved in nefarious financial activities.  

“It is imperative that customers are protected from fraud and abuse, and that these markets are fair and transparent,” wrote lawmakers, including Debbie Stabenow, the top Democrat of the Senate Agriculture Committee, and John Boozman, the panel’s top Republican.  

David Scott, the Democratic chair of the House agriculture panel, and Republican ranking member, Glenn Thompson, also signed the letter. The agriculture committee oversees the CFTC, which has its fingers on most of the $610 trillion global derivatives sector.  

Lawmakers continue to debate and battle with regulators about whether crypto tokens are securities that should be overseen by the Securities and Exchange Commission, a move supported by SEC Chairman Gary Gensler.  

Bitcoin and ether are commodities that would fall under the CFTC’s purview, the letter says, given their place as the largest digital coins. The CFTC has been keeping a close eye on the crypto market since allowing Bitcoin futures to start trading in 2017.  

In their letter, lawmakers also asked CFTC Chairman Rostin Behnam to share the steps the agency is taking to protect consumers and firms with other regulators when it comes to decentralized finance (DeFi).  

Related: Hong Kong Weighs Crypto, Stablecoin Regulations 

Meanwhile, the Hong Kong Monetary Authority (HKMA) is weighing its own regulations for cryptocurrencies and stablecoins and plans to launch a framework by July, in accordance with recommendations from the Financial Stability Board (FSB), an international organization that aims for global financial stability. 

The FSB is likely to establish or amend a regulatory framework for cryptocurrency and stablecoins by July, according to a HKMA discussion paper.