CFTC chairman advocates ‘do no harm’ approach to crypto regulation
The chairman of the US Commodity Futures Trading Commission (CFTC) said at the weekend that regulators must avoid inhibiting innovation when regulating cryptocurrencies.
J Christopher Giancarlo said at the annual Singapore summit on Friday that regulators must take a “do no harm” approach – similar to the light-touch regulatory landscape that allowed the internet to flourish.
“I’m advocating the same approach to cryptocurrencies and all things having to do with this new digital revolution of markets, and of currencies, and of asset classes,” Giancarlo said.
Fraud and manipulation
On some occasions a stricter approach must be taken to protect investors and the public, he said – particularly with regard to fraud and market manipulation – but otherwise he favoured a studied perspective.
He said: “When it comes to fraud and manipulation, we need to be strong. When it comes to policy making, I think we need to be slow and deliberate and well informed.”
Cryptocurrency regulation in the US has been criticised for its lack of clarity and the jurisdictional differences between the CFTC and the Securities and Exchange Commission (SEC) which further confuses the crypto regulatory landscape.
New appointment in April
Giancarlo retires from the CFTC in April, leaving a position open on the Commission to be appointed by President Trump. Speculation is rising that Trump will nominate a pro-cryptocurrency commissioner.
Earlier in September the President appointed a new SEC commissioner Elad Roisman, who immediately signalled his intention to focus on the fair treatment of cryptocurrencies.
Earlier this year he told the Senate Banking Committee that the SEC must re-examine its rules and regulations particularly with regards to the emergence of new investment and technologies such as blockchain and initial coin offerings.
He added: “It is essential that the SEC approach these new challenges in a fair and transparent manner, provide clarity and certainty to the markets and investors, and enforce the laws and regulations that hold market participants accountable.”