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Gary Gensler, the chairman of the Securities and Exchange Commission (SEC), stated yesterday at an industry conference that he was looking forward to collaborating with lawmakers on Capitol Hill to promote plans to give the Commodity Futures Trading Commission (CFTC) more control over cryptocurrencies. Gensler pointed out that the commission would need to be granted more power to control the market. He quickly added that further supervision shouldn't replace his own SEC's jurisdiction. Congress would need to amend the legislation to provide the CFTC the authority to monitor cash markets for specific digital assets, as it is now only permitted to supervise derivatives. Additional financing is required to achieve any such aim. The CFTC's ability to regulate Bitcoin and Ethereum is now the key driving force.
Shift In Digital Asset Sector
Realizing that regulation was coming, the digital asset sector shifted its position from being in support of no rules to favoring appropriate monitoring by the CFTC instead of the SEC. However, the SEC contends that other cryptocurrencies are securities and should be treated like this. Even if we assume that Gensler's approval would lead to Bitcoin and Ethereum eventually falling within the CFTC's purview, there are still many unanswered concerns. The need for regulating exchanges and custodians may be more vital than cryptocurrencies themselves.
Responsibilities Of Regulators
To prevent funding of terrorism, money laundering, and other forms of illegal drug use, a regulator must decide what additional information exchanges should collect. There are concerns about technical regulation in addition to financial control. Whether the SEC or the CFTC takes over as Bitcoin's supreme authority, there are still some unanswered concerns.