CFTC Proposes Rule Changes to Address Crypto Volatility and Digital Asset Risks
The U.S. Commodity Futures Trading Commission (CFTC) is proposing changes to its risk management rules, which will require firms to prepare for the volatility of cryptocurrencies and the risks associated with holding customers' digital assets.
CFTC Warns Companies to Counter Risks in Clearing Digital Asset Transactions
The U.S. Commodity Futures Trading Commission (CFTC) is warning companies to be cautious and take action to mitigate risks when clearing digital asset transactions. The CFTC's Division of Clearing and Risk has issued an advisory in response to an increase in supervised entities clearing such trades, with a focus on emerging risks in the crypto industry. These risks include potential conflicts of interest, cyber threats, and managing physical delivery of digital assets. The agency expects companies to actively identify and implement risk mitigation measures tailored to these risks. The CFTC has already taken enforcement actions against crypto companies and may have a wider future role as an industry watchdog.
Former CFTC Commissioner Says Ethereum Falls Under SEC and CFTC Regulatory Purview
As the debate over which regulatory agency has jurisdiction over Ethereum (ETH) in the United States continues, former CFTC Commissioner Dan Berkovitz has stated that ETH can be categorized as both a commodity and a security. He argues that the digital asset falls under the jurisdiction of both the SEC and the CFTC due to the existing legal framework. However, the SEC's regulatory approach has been criticized by crypto executives and users as "stifling" and harsh. The regulatory confusion in the digital asset market has been evident in the contradictory claims made by both the CFTC and the SEC in the last six months.
Binance Faces Backlash Over Allegations of Customer Fund Commingling and Regulatory Breaches
Binance, the largest cryptocurrency exchange, is facing accusations of commingling customer funds totaling billions of dollars and regulatory breaches. Anonymous sources claim that Binance frequently used the collapsed Silvergate Bank for mixing funds. The stablecoin at the center of the dispute, BUSD, has been accused of being used to credit user accounts rather than genuine U.S. dollars. Binance denies the allegations, but the U.S. Commodity Futures Trading Commission (CFTC) has levied severe accusations against the company, alleging that it allowed trading firms based in the U.S. to engage in crypto derivatives trading on its international exchange while commingling funds and circumventing compliance controls.
US Crypto Crackdowns Prompt Businesses to Consider Offshore Operations: CFTC Commissioner Cautions Against Perceiving the Agency as a "Light Touch" Regulator
The United States has witnessed a surge in regulatory actions against cryptocurrency, leading businesses to consider relocating their operations overseas.
Former CFTC Commissioner Claims Ethereum's Ether May Be Both a Commodity and a Security
Former commissioner of the United States Commodities Futures Trading Commission, Dan Berkovitz, has suggested that Ethereum's native Ether (ETH) token could be both a commodity and a security. This is due to the overlapping legal definitions of commodities and securities, meaning that an asset can be classified as both.
CFTC Commissioner Warns of Difficulty in Policing Crypto Fraud
Christy Goldsmith Romero, a Commissioner of the U.S. Commodities and Futures Trading Commission (CFTC), has stated that due to the sheer volume of fraud in the crypto space, it is difficult for the federal regulator to effectively police the industry. She revealed that crypto cases account for about 20% of the CFTC’s portfolio, including ongoing civil cases against bankrupt crypto exchange FTX and crypto giant Binance.
US Regulator Says Cryptocurrency Fraud Too Widespread to Police
Christy Goldsmith Romero, a commissioner at the Commodity Futures Trading Commission (CFTC), has stated that there is too much cryptocurrency fraud for the agency to police all of it. She added that cryptocurrency cases account for around 20% of the CFTC's portfolio, including recent civil cases against Binance and FTX exchanges. While Goldsmith Romero denied any "turf war" between the CFTC and the Securities and Exchange Commission over regulating crypto, she acknowledged that the agencies are still figuring out how to regulate the industry's new products. She also warned crypto companies not to view the CFTC as a "light touch regulator."
CFTC Chair Says Decentralized Crypto Exchanges Will Be Regulated Despite "Just Code" Protocols
Commodity Futures Trading Commission Chair Rostin Behnam has stated that decentralized crypto exchanges will be regulated by either the CFTC or the Securities and Exchange Commission, even if they are based on self-effectuating protocols.
US SEC Prepares Enforcement Action Against Binance and Coinbase
The US Securities and Exchange Commission is reportedly taking enforcement action against Binance or Binance.US, the world's largest crypto exchange. Binance has faced enforcement action from the US CFTC and ongoing probes by the DOJ for violating sanctions against Russia. The SEC has sent a Wells notice to Coinbase, but Coinbase has stated that this will have no impact as it doesn't list securities. Binance has paused Bitcoin withdrawals due to congestion on the Bitcoin blockchain. Both Binance and Coinbase are under scrutiny from the US SEC.
