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Commodity Futures Trading Commission (CFTC) Chairman Rostin Behnam stated that 70-80% of crypto are not securities. This view, reported by journalist Eleanor Terrett, provides crucial relief to the crypto sector, which has been embroiled in regulatory disputes with the US Securities and Exchange Commission (SEC) for years.
Behnam also urged a balanced framework for classifying tokens as commodities or securities. Furthermore, he emphasized the importance of continued collaboration between the SEC and the CFTC.
CFTC Wants to Regulate Crypto Industry
During a discussion with Senator Roger Marshall about the jurisdictional tussle between the SEC and the CFTC, Behnam advocated for the CFTC’s complete oversight of the crypto market. He suggested that this could simplify regulations, though it would require redefining what constitutes securities and commodities.
“I think we have the [crypto regulation] expertise and the capacity,” Behnam claimed.
Read more: Crypto Regulation: What Are the Benefits and Drawbacks?
Behnam’s position sharply contrasts with that of SEC Chairman Gary Gensler, who argues that all crypto, except Bitcoin (BTC), are securities. The classification of these digital assets has significant regulatory implications, determining their governing bodies.
Moreover, a recent District Court decision in the Northern District of Illinois reinforced the CFTC’s perspective, ruling that Bitcoin and Ethereum (ETH) are commodities. The Court also deemed altcoins such as Olympus (OHM) and KlimaDAO (KLIMA) as commodities under the Commodity Exchange Act.
Behnam emphasized the CFTC’s active role in the crypto sector.
“Nowhere have we been more active than in the digital asset space. In FY 2023, we brought 47 actions involving conduct related to digital commodities, representing more than 49 percent of all CFTC actions filed during that period,” Behnam said.
The chairman also stressed the unsustainability of current efforts without a formal regulatory framework. He reiterated the urgent need for Congressional action, as underscored by the 2022 Financial Stability Oversight Council report.
Read more: Who Is Gary Gensler? Everything To Know About the SEC Chairman
Reflecting on his seven years at the CFTC, Behnam observed significant market evolution, with periods of high volatility and numerous scandals. He noted the growing involvement of established financial institutions in the crypto sector and expressed concern over the lack of protective regulations for investors.