{"id":1768633,"date":"2022-12-09T06:10:10","date_gmt":"2022-12-09T11:10:10","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1768633"},"modified":"2022-12-09T06:48:30","modified_gmt":"2022-12-09T11:48:30","slug":"financial-regulatory-bodies-vie-for-power-over-crypto-industry","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/financial-regulatory-bodies-vie-for-power-over-crypto-industry\/","title":{"rendered":"Financial Regulatory Bodies Vie for Power Over Crypto Industry"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">18<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Ffinancial-regulatory-bodies-vie-for-power-over-crypto-industry%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1768633&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><p>The collapse of the cryptocurrency exchange <a href=\"https:\/\/www.theepochtimes.com\/t-ftx\">FTX<\/a> has reignited a power struggle between two federal agencies\u2014the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC)\u2014for domain over digital assets. Many in the <a href=\"https:\/\/www.theepochtimes.com\/t-crypto\">crypto<\/a> business complain that the struggle between those agencies is\u00a0one of the reasons for delays in rules to govern that industry.<\/p>\n<p>The first congressional <a href=\"https:\/\/www.agriculture.senate.gov\/hearings\/why-congress-needs-to-act-lessons-learned-from-the-ftx-collapse\">hearing<\/a> related to the failed exchange since it declared bankruptcy in early November occurred last week. CFTC Chair Rostin Behnam, as the sole witness of the hearing, fielded questions from a bipartisan panel of U.S. senators, including Chuck Grassley (R-Iowa), Amy Klobuchar (D-Minn.), and Cory Booker (D-N.J.).<\/p>\n<p>Behnam\u2019s opening remarks at the hearing called for more clarity in digital asset regulation.<\/p>\n<p>\u201cFor years, many have recognized that a patchwork of federal and state-based regulation is an unsuitable substitute for a comprehensive approach,\u201d he stated.<\/p>\n<p>The CFTC is an independent federal agency responsible for overseeing the derivatives markets in the United States, including futures contracts, options, and swaps.<\/p>\n<p>The hearing was hosted by the Senate Committee on Agriculture, Nutrition, and Forestry. The chair of the committee, Sen. Debbie Stabenow (D-Mich.), <a href=\"https:\/\/www.theepochtimes.com\/bankman-fried-pushed-for-crypto-regulation-in-weeks-leading-up-to-ftx-bankruptcy_4881892.html\">sponsored<\/a>\u00a0legislation earlier this year that would have enhanced the CFTC\u2019s regulatory power over the crypto industry.<\/p>\n<p>Stabenow, who\u00a0<a href=\"https:\/\/www.theepochtimes.com\/bankman-fried-pushed-for-crypto-regulation-in-weeks-leading-up-to-ftx-bankruptcy_4881892.html\">received<\/a> campaign donations from Sam Bankman-Fried, distanced herself from\u00a0the FTX founder\u00a0and former CEO during the hearing.<\/p>\n<p>\u201cAt best, these events uncovered an alarming lack of internal controls and egregious governance failures. At worst, Sam Bankman-Fried and his inner circle lied to and stole from over 1 million customers, some of whom have lost their life savings,\u201d Stabenow said in her opening remarks.<\/p>\n<p>Stabenow\u2019s bill, called the Digital Commodities Consumer Protection Act (DCCPA), was heavily <a href=\"https:\/\/www.theepochtimes.com\/bankman-fried-pushed-for-crypto-regulation-in-weeks-leading-up-to-ftx-bankruptcy_4881892.html\">backed<\/a> by Bankman-Fried. That led many, including SEC Chair Gary Gensler, to <a href=\"https:\/\/www.theepochtimes.com\/bankman-fried-pushed-for-crypto-regulation-in-weeks-leading-up-to-ftx-bankruptcy_4881892.html\">call<\/a>\u00a0into question the motivation behind the initiative.<\/p>\n<p>At the hearing, Behnam, a proponent of DCCAP, expressed uncertainty as to why Bankman-Fried supported the proposed legislation. The CFTC chair also claimed to have met with FTX leadership 10 times over the previous 14 months, but emphasized he didn\u2019t possess the authority to investigate the company thoroughly.<\/p>\n<p>Benham assured that FTX would have failed to meet DCCAP\u2019s guidelines.<\/p>\n<p>To strengthen his case for unified regulation, Benham emphasized that FTX-affiliate LedgerX, which is registered with the CFTC, hasn\u2019t filed for bankruptcy.<\/p>\n<p>Sen. John Boozman (R-Ark.), the ranking Republican member of the committee and the other sponsor of DCCPA, asked the CFTC chair to respond to allegations that Bankman-Fried backed the legislation to ensure his companies were governed by a \u201csoft touch regulator.\u201d Behnam disagreed with the premise that the CFTC would be more lenient than other agencies.<\/p>\n<p>\u201cI patently reject that suggestion,\u201d he said.<\/p>\n<p>Behnam voiced his support for the Stabenow\u2013Boozman bill several times over the course of the hearing.<\/p>\n<h2>Defining Tokens<\/h2>\n<p>Gensler has made his opposition to the bill clear, stating in early November that the proposal \u201cwould unambiguously undermine investor protection.\u201d For years, he has advocated that many cryptocurrencies qualify as securities and therefore are under the purview of his agency.<\/p>\n<p>On the subject of Stablecoins\u2014crypto tokens whose values are pegged to the U.S. dollar\u2014Gensler has <a href=\"https:\/\/www.reuters.com\/technology\/secs-gensler-says-cftc-authority-over-stablecoins-should-be-bolstered-2022-10-14\/\">conceded<\/a> that this particular digital asset falls more appropriately within the CFTC\u2019s specialty. Behnam echoed a similar sentiment last week, asking for congressional clarity in defining which tokens are commodities and which are securities.<\/p>\n<p>\u201cSenator, it goes to the core of the issue,\u201d Benham said in response to Sen. Deb Fischer (R-Neb.), who raised the issue of unclear token classifications. \u201cIt is the gap that exists that provides and presents customer protection risks.\u201d<\/p>\n<p>Washington outsiders have criticized the slow-to-change and confusing state of U.S. digital asset regulations as well.<\/p>\n<p>David Sacco, a finance instructor at the Pompea College of Business at the University of New Haven, for example, says the current approach is all wrong.<\/p>\n<p>\u201cWe need some of the smartest people in these industries involved in regulating them, and we do not currently get that,\u201d he told The Epoch Times.<\/p>\n<p>Sacco stressed the importance of \u201cbetter\u201d regulation, as opposed to simply piling more on. He also acknowledged that participants in the crypto markets bear some level of personal responsibility.<\/p>\n<p>\u201cI think the answer is to make it explicitly understood that new technologies and investment classes inherently contain risk.\u201d<\/p>\n<div class=\"author_wrapper\">\n<div class=\"one_author_block round\">\n<div class=\"top_row\">\n\t\t\t\t\t<a href=\"https:\/\/www.theepochtimes.com\/author-liam-cosgrove\"><img decoding=\"async\" src=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-content\/uploads\/2022\/11\/LiamCosgrove_WEB.jpg\" alt=\"Liam Cosgrove\"   style=\"display:none\"><\/a><\/p>\n<p>Follow<\/p>\n<\/div>\n<p>Liam Cosgrove works as a freelance journalist covering business, markets, and finance. He received his bachelor&#8217;s degree in mathematics from the University of California, Santa Barbara.<\/p>\n<\/p><\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>The collapse of the cryptocurrency exchange FTX has reignited a power struggle between two federal agencies\u2014the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC)\u2014for domain over<\/p>\n","protected":false},"author":1,"featured_media":1732864,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[547],"tags":[6986,5458,6987,4263,6984,5084,6985,3819,6988],"class_list":["post-1768633","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-bongino-report","tag-bodies","tag-bongino","tag-crypto","tag-financial","tag-industry","tag-power","tag-regulatory","tag-report","tag-vie"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1768633","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1768633"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1768633\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/1732864"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1768633"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1768633"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1768633"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}