CFTC Chairman Giancarlo: ‘Crypto Is Here to Stay’

While the U.S. SEC has shied away from crypto regulation, the CFTC has taken a different tack, having embraced the market even while fighting to fend off fraud. Chris Giancarlo, chairman of the U.S. Commodity Futures Trading Commission (CFTC), shared a glimpse into his level-headed approach with CNBC, chief among which was his belief that cryptocurrencies aren’t going anywhere.

Source: CNBC

The CFTC’s is an acceptance that thus far the U.S. Securities and Exchange Commission, under whose purview ICO security tokens are placed, has yet to demonstrate. Meanwhile, bitcoin and ETH as commodities are under the oversight of the CFTC.

It was a little less than a year ago when the CFTC green-lighted bitcoin futures contracts for U.S. CBOE and CME exchanges, a process it was deeply engaged with for months.  Chairman Giancarlo appears to have no regrets, saying instead that the agency is dedicated to stamping out fraud, which would help to create a healthier environment in which consumers could invest.

“We’re very focused on the fraud and manipulation aspects of cryptocurrency markets right now,” he told CNBC.

The CFTC scored a recent legal victory in which a Boston court gave the agency permission to pursue charges against the perpetrators of crypto-fueled fraud.

Striking a Balance

Meanwhile, Giancarlo defended the U.S. scorecard for blockchain innovation, most notably by creating a model for bitcoin derivatives comprised of “bitcoin futures trading on the CME and also bitcoin options and bitcoin clearing,” he said, adding: “We’re leading the world in that.”

As for the disconnect between the crypto markets and the SEC, it’s begun to spill over into Capitol Hill. Lawmakers in recent days queried  SEC Chairman Jay Clayton for greater clarity on the lens through which the Wall Street regulator views crypto. In a letter addressed to Chairman Clayton, the lawmakers stated bluntly: “We believe the SEC could do more to clarify its position.” The ball is in the SEC’s court, but that’s not stopping lawmakers from both sides of the aisle from crafting supportive blockchain bills of their own.

Meanwhile, until the U.S. can get its regulatory act together, it risks losing out on innovation and investment. The crypto community is demonstrating patience about a bitcoin ETF, and chances are they’ll need to remain that way until early 2019 at the soonest.

Giancarlo didn’t defend the SEC, but he did point out that these are traditional agencies whose statutes were written nearly 100 years ago. And while the CFTC approaches crypto from an institutional investor standpoint, its regulatory peer must consider it from the retail investor’s perspective and protection. In the end, it’s about striking a balance between stamping out fraud and nurturing blockchain innovation. Giancarlo wrapped it up by stating:

“I personally think that cryptocurrencies are here to stay. I think there is a future for them.”

Featured image courtesy of Shutterstock.

Gerelyn has been covering ICOs and the cryptocurrency market since mid-2017. She's also reported on fintech more broadly in addition to asset management, having previously specialized in institutional investing. She owns some BTC and ETH.