J. Christopher Giancarlo Chairman of United States Commodity Futures Trading Commission (CFTC) has highlighted that the agency doesn’t want to hinder the development of the blockchain asset sector, but the agency’s commitment is to monitor the sector.
During a speech devoted to EU-U.S. regulatory cooperation for derivatives markets, Giancarlo voiced his agency’s support of international efforts to assess the efficiency of the G20’s derivatives reform agenda. CFTC is dedicated to enhancing the derivatives markets and to making its own rules and regulations simpler.
The Chairman isolated the CFTC’s positive approach to new derivatives products for crypto assets and other emerging technologies, recommending that:
“We have resisted calls to use our legal powers to suppress the development of crypto-assets. […] Instead, we have favoured close monitoring of market developments while not hindering the introduction of new products like bitcoin futures, which have proven invaluable in letting market forces determine the appropriate value of the bitcoin.”
It was previously advised by Giancarlo that the agency’s authorization of Bitcoin futures was steady with the agency’s agenda to the value innovation of the market.
In regard to his last claim, Giancarlo referenced a May 2018 research paper from the Federal Reserve Bank of San Francisco. The paper had claimed that the launch of Bitcoin (BTC) futures trading on two major exchanges, the Chicago Mercantile Exchange and the Chicago Board Options Exchange, had adequately expanded the crypto derivatives market to offset one-sided speculative demand and allow for a more balanced correction to inflated valuations.
CFTC’S own fintech innovation hub, LabCFTC, intends to keep pace with the parabolic transformative technological change in the blockchain space, proposed Giancarlo.
In late 2018, public and industry comments on the Ethereum (ETH) blockchain was implored by the lab. This was done to evaluate the authorization of Ethereum futures contracts.
Two of LabCFTC’s fintech educational primers to date have been devoted to crypto and blockchain: on virtual currencies in October 2017 and smart contracts in November 2018.