CFTC Chairman Says Expect Regulators to Crack Down on More Crypto Firms

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Tanzeel Akhtar

Journalist

Tanzeel Akhtar

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Tanzeel Akhtar has been covering the cryptocurrency and blockchain sector since 2015. She has written for the Wall Street Journal, Bloomberg, CoinDesk, Bitcoin Magazine and Bitcoin.com.

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May 6, 2024 23:40 EDT

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The Commodity Futures Trading Commission (CFTC) chairman Rostin Behnam said cryptocurrency firms can expect to see more enforcement action from U.S. regulators in the next 6 to 24 months as retail interest in the asset class increases.

Expect to see “another cycle of enforcement actions” in the cryptocurrency space warns CFTC Chairman Behnam speaking at the 27th annual Milken Global Conference on Monday.

The U.S. Securities and Exchange Commission (SEC) has been busy actively pursuing legal challenges against several cryptocurrency firms and ramping up its crackdown on trading. Most recently the SEC is preparing to sue U.S. brokerage firm Robinhood Markets cryptocurrency unit.

During the panel discussion, Behnam stressed the importance of regulation and consumer protection highlighting the events of 2022 involving the collapse of the cryptocurrency exchange FTX.

“From my standpoint as a regulator we are probably going to see in the next 6 to 18 months or 6 to 24 months another cycle of enforcement actions because of this cycle of asset appreciation and interest by retail investors,” said Behnam.

“Putting aside the legitimacy and where this technology might go and what role it might play in our economy and commerce and the internet, digital assets generally we have to think about things from a regulatory and consumer protection standpoint,” adds Behman.

In March this year, Behnam reiterated his call for Congress to pass legislation clarifying crypto regulation. The call for congressional action was presented during a hearing before the House Agriculture Committee.

Crypto Regulation is Lagging Behind

Behnam emphasized the situation’s urgency, citing the rapid growth of the crypto market and its increasing mainstream acceptance. He highlighted the need for clarity on Bitcoin’s regulatory status, noting its major market share alongside Ethereum.He urged Congress to address the regulatory gap swiftly, emphasizing that cryptocurrencies, especially Bitcoin, are here to stay. Amid increasing scrutiny and lawmaker interest, Behnam’s call for action was prompted by inquiries into the CFTC’s budget.

At the 27th annual Milken Global Conference on Monday, Behnam highlighted despite the recent scandals in 2022, the cryptocurrency market is seeing growth. 

“There is sustainability to this asset class,” argues Behnam. “We have obviously had to deal with a lot of bad events in 2022 that from a regulatory point of view quite frankly has proved a lot of things I’ve been saying for 5 or 6 years,” said Behnam.

“Despite what happened in 2022 we find ourselves in a growing market growing capital investment and growing market capitalization and I think renewed interest by a lot of entrepreneurs,” adds Behnam.