Rostin Behnam, the head of the US Commodity Futures Trading Commission (CFTC), has advocated for implementing regulatory measures to oversee the cryptocurrency market, which he asserts is primarily composed of commodities. He has expressed apprehensions regarding the lack of definitiveness within the industry and the possibility of deceit and manipulation.
Speaking on an Intercontinental Exchange (ICE) podcast recently, Behnam emphasized the demand among market participants, particularly institutional investors, for a well-defined regulatory structure for the cryptocurrency domain. He also highlighted the necessity for individual clients to have protective measures against risks within the crypto sphere.
“The market seems to want some kind of regulatory framework,” Behnam stated.
“You can predict that institutional demand will likely increase if there is a clear regulatory framework. But to me, we think of individual participants, and I think of our ten-year practice history before me. And I think that’s pretty clear evidence that something needs to be done.”
Behnam’s statements conflict with those made by Gary Gensler, the Chairman of the Securities and Exchange Commission (SEC), who contends that the majority of cryptocurrencies are categorized as securities and are subject to existing securities regulations. Gensler further asserted that enacting new legislation is unnecessary for the regulation of cryptocurrencies.
Nonetheless, Behnam presented a differing viewpoint, asserting that approximately 70 per cent of the cryptocurrency market consists of commodities, warranting a distinct approach.
He suggested that Congress should introduce a bill to address the regulatory gaps pertaining to commodity tokens, thereby empowering the US Commodity Futures Trading Commission (CFTC) with enhanced authority and resources to supervise the market.
Following Behnam’s proposal for this regulatory framework, there was a noticeable decline in the value of Bitcoin.
The podcast also touched upon matters related to Bitcoin-related products such as futures and exchange-traded funds (ETFs).
Chief Communications Officer of the Intercontinental Exchange (ICE), Josh King, elucidated that some Bitcoin futures contracts have been removed from trading due to insufficient demand.