The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) “have to rely on 70-year-old case law to determine what’s a security or a commodity,” according to the CFTC chairman. Noting that “It’s not a turf war,” he emphasised that the CFTC and SEC are coordinating to supervise the cryptocurrency industry.
In response to a question about whether the CFTC and Securities and Exchange Commission (SEC) get along and whether the two agencies collaborate to regulate the cryptocurrency industry, the chairman said that the two regulatory organisations “get along” and that they have collaborated in the past and will continue to do in the future.
He clarified that the CFTC’s role as a derivatives regulator presents challenges for them. They are not in charge of the cash markets. In order to participate in the markets for “bitcoin cash, ether cash,” and other digital tokens, he had been requesting that Congress grant him “cash authorities.” He smartly slides into the conversation that digital tokens are commodities.
“……so that we can go in the bitcoin cash market, the ether cash market, and the other digital commodity token [markets],”
In addition, the CNBC reporter questioned him on Gary Gensler’s assertion that all digital tokens are securities. He stated that because it is a new asset class, they would need to examine it “legislatively.” He clarified that compared to traditional assets, digital tokens are very different assets. Gensler has invited crypto firms to work with the government to form a policy for industry participants.
He also brought up a current legal dispute in New York that refers to bitcoin as a commodity. He claims that “certainty for the market” will be established by the case’s outcome.
Gary Gensler thinks that most of the approximately 10,000 tokens traded on the cryptocurrency market, with the exception of bitcoin, are securities. He has on occasion admitted that Bitcoin is a commodity. Just like the CFTC chairman, the SEC’s top boss also says that the two agencies are working together to regulate the crypto industry.
A sensible regulation of the cryptocurrency industry in the US may be feasible, as shown in the Lummis-Gillibrand bill—if approved by the Congress. The Responsible Financial Innovation Act was introduced by Senator Lummis and Senator Kirsten Gillibrand in July 2022. It’s a thorough plan for preserving American financial hegemony and safely integrating innovation into the country’s financial system.