CFTC Chairman Chris Giancarlo Raises Alarm For Staying ‘Behind’ On Blockchain Developments
In his address to the U.S Congress on Wednesday, CFTC Chairman Chris Giancarlo discussed a few things about his agency’s role in regulating the crypto market and how the U.S blockchain needs to gear up to meet with the ongoing global competition.
With a lot of questions being pointed on CFTC’s role and involvement in crypto regulations, Giancarlo made it clear that his agency’s primary job is not to have jurisdictions on the function of cash markets or cryptocurrency trading markets. The role of CFTC is to deal with compliances in derivatives and commodities or futures market.
Christopher Giancarlo was speaking before the House Committee of Agriculture and was also thrown with questions regarding CFTC’s role in the blockchain space. Giancarlo said that the CFTC was approached by the world six latest banking institutions to build a prototype blockchain system for making banking payments and trading credit default swaps. They also asked CFTC to control a regulatory node on the blockchain network, but this sharing of information would be regarded as a gift and the CFTC Acts prohibits the agency from accepting any sort of gifts.
He said that the commission has to put enough efforts in developing the blockchain framework for which it requires funding to be coming from proper channels. He said that the commission is falling behind its contemporaries.
Giancarlo said: "We're falling behind. Just two days ago the Bank of England announced that they're putting in a new bank-to-bank payment system in the UK and it's going to be blockchain-complaint.”
He further added: "[The Bank of England has] had the last four years ... to participate in all these blockchain beta tests that we have not been able to participate in and they've been able to get comfortable with the technology and now they're incorporating it. I feel we're four years behind because we do need to test it, we do need to understand it so we can do a better job as regulator before I then come to Congress and say we need money to build something.”
Rep. Adams further asked the CFTC chairman whether his agency wants the Congress to grab them additional jurisdiction to oversee the crypto market. Giancarlo in response said that his agency currently handles fraud jurisdiction, and doesn’t hold authority on crypto exchange platform standards for registering new user accounts and other similar activities.
He said: “It is not the historical role of the CFTC to play this type of role in cash markets. It is not my place to advocate for expanded jurisdiction. There may come a time for the govt to step, but the question is when is the time. The total value of crypto market is probably less than one big publicly traded company so it’s not a big market.”
Giancarlo also said that crypto regulation can be well-calculated step and approached properly. He said: "The best model I like to point to in the 1990s when a Democrat White House and a Republican Congress worked together around this thing called the internet and took a 'first-do-no-harm' approach. Regulation came slowly and let the technology evolve. think we need to stay close to it, we need to be careful, but I think we can let it develop a little bit before we run in with regulation.”