CFTC Chairman Rostin Behnam argued that non-bank institutions, including exchanges, “thrive” in conditions of regulatory certainty…
US Commodity Futures Trading Commission (CFTC) chairman Rostin Behnam said that potential regulation of the cryptocurrency market under CFTC guidance could have significant benefits for the industry, including a potential boost to the price of bitcoin.
“There can be growth if we have a well-regulated space,” Behnam told attendees during a talk at NYU Law School. “Bitcoin can double in value and price if there is a CFTC-regulated market.” (At the time of writing, the largest cryptocurrency was worth $19,610.)
Recall that Behnam has consistently argued for the need for regulatory clarity – something many in the crypto industry have argued is lacking.
For years, the CFTC and the U.S. Securities and Exchange Commission (SEC) have been competing with a glorious field of glory in the cryptocurrency market…
However, both authorities have been reluctant to issue any formal guidance, opting instead to set a regulatory precedent through “suppression” actions.
In this context, a clear regulatory framework, Behnam argued, could pave the way for institutional investors to enter the market. “Institutionalists see a huge opportunity, but inflows will only occur if there is a regulatory structure around these markets,” Behnam said.
“Non-bank [crypto] institutions thrive in conditions of regulatory certainty, they thrive when they face a level playing field. And they may find disagreements about the type of regulation – but what they like most is regulation because they are the smartest, the fastest and the ones with the most resources. With these characteristics, they can beat everyone else in the market,” Behnam added.
Settlement through legislation
A bipartisan bill introduced by the leaders of the Senate committee in charge, which oversees the CFTC, would crown the CFTC the primary regulator for the cryptocurrency industry, making the agency responsible for the proper functioning of spot markets.
Behnam said he supports the bill, which includes a provision that allows for fees to be imposed on regulated entities – something Behnam argued would be critical if the CFTC is to face the challenge of regulating cryptocurrency.
Just to remind you that the European Union has already submitted the final bill for the regulation of cryptocurrencies. The draft is expected to be adopted before the end of 2022 and to be fully implemented across the EU territory in 2023 – 2024.