Crypto Frontline

The Commodities Futures Trading Commission, one of the main financial regulators in the United States, had been very active lately in terms of talking about cryptocurrencies and digital assets. Chairman Chris Giancarlo had been testifying during a hearing with the House Agricultural Committee on Wednesday, giving some valuable information related to cryptocurrencies and regulation.

Top world banks approached CFTC

The CFTC chairman had made an interesting revelation during its speech, saying that the world’s six biggest banks made contact with the institution. Their objective was to build a prototype for a blockchain-based system, specially designed for trading credit default swaps and handling bank payments, according to a recent material published on ccn.com.

Also, the CFTC had been offered to opportunity to be part of the project by designing a regulatory node for the commission to control, but this could be regarded as a gift and the CFTC Act prohibits it.

US regulation falling behind

The CFTC chairman had also “ringed some alarm bells” saying that the US is falling behind other nations in terms of cryptocurrency regulation. He mentioned the Bank of England, which had already announced an upgraded payment system that will be blockchain compliant, an information we have discussed in our previous article. Chris Giancarlo had said the following:

“We’re falling behind. The Bank of England has announced a new blockchain compliant payment settlement system. We’re 4 years behind. We need to test and understand it and know how to work it as a regulator before coming to Congress. …Using subpoenas to get information from blockchain finance industry I think is the wrong way to go about it. I think cooperation is the way forward.”

CFTC has limited jurisdiction

He also mentioned during his speech that the CFTC will need approval from Congress in order to be able to get involved deeply in the crypto industry. The agency does not have any legal authority over cryptocurrency exchange standards and account registration.

Chris Giancarlo had also made it clear that the CFTC will never act like a police of the cryptocurrency market and emphasized the fact that the SEC has more legal authority over the industry.

The issue of regulation continues to be in the center of attention and a country like the United States will find it difficult to implement any legislation. There’s a hard debate on who will need to take care of the industry, and thus far the SEC seems to be the most likely to handle it.