© CoinDesk Courtesy of Rostin Behnam, President of the US Commodity Futures Trading Commission (Suzanne Cordeiro/Shutterstock/CoinDesk)Just because Rostin Behnam is the rare government official who might casually post comments that could lead to a future bitcoin price boom doesn't mean he's the cryptocurrency brother.
The chairman of the Commodity Futures Trading Commission (CFTC) is seen as a relatively pro-government figure in crypto circles, and Behnam has often said things that reinforce that view.
Speaking to NYU students last week, Behnam said he's "cautious about being a cheerleader" for cryptocurrencies, but called the industry's explosive growth "exciting" and "exciting."
"I think there are people who want this technology to go away, it can go away, it can go abroad, but I think there are a number of reasons why it's important for us to work with [the industry]. . From a Union perspective, be united," Behnam said. He said
"We need to ask ourselves serious questions about whether this is the future of our money and the future of our economy, which is just the way it is."
Behnam also predicts that Bitcoin's price will even double and predicts that the cryptocurrency asset will eventually be subject to government regulation and oversight, which will generate more money for investors. Jeremy Liabon, a Chicago-based attorney for the law firm Ropes & Gray, received a Bitcoin price prediction, albeit a hypothetical one, from regulators.
But Behnam is a federal regulator set up by the President himself, who appointed Gary Gensler to head the Securities and Exchange Commission (SEC), which considers the cryptocurrency industry anti-government. SEC Gensler is often tasked with regulating cryptocurrencies through law enforcement and shows only signs of wanting to speed up the process. While Behnam is seen as a soft movement for digital assets and doesn't look down on the public too much, his agency is waging an app battle that belies that reputation.
"If anyone thinks you're going to get a CFTC clearance, I think that's a misunderstanding," former CFTC attorney Gary DeWaal told Caten Mnuchin Rosenman. "Any breach will be addressed with firm action by both regulators and they will be tough."
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The CFTC itself has rejected the false assumption that it will govern the industry on a lighter note than the SEC.
"We are very strong in the use of digital assets," CFTC Commissioner Caroline Pham told attendees at Korea Blockchain Week in August. “Anyone who thought the CFTC wasn't resilient probably overlooked the fact that after the financial crisis we fined all banks billions for fraud and manipulation.”
Mike Selig, a New York-based attorney with the law firm Wilkie Farr & Gallagher, said cryptocurrency companies should not equate enforcement action with "hostile" regulations.
"To welcome [decentralized money] will require new laws and regulations," Selig said. "But I think there is a willingness to work with the cryptocurrency industry at board and employee levels to bring responsible innovation to the United States."
Also Read: Bitcoin Price Could Double Under CFTC Rules, Says President Behnam
Momentum is building in Congress to make the CFTC the main frontline regulator for cryptocurrency trading. Any serious legislative effort in the Senate and House Agriculture Committees supports this path, such as a bill to make the agency the regulator of the so-called spot market for non-security tokens. According to Behnam, this means trading Bitcoin and Ethereum, which make up the bulk of the cryptocurrency market cap.
The Senate Agriculture Committee's bill — sponsored by former Behnam leader, the panel's chair Debbie Stabenow (D-Mich.) — will give the CFTC unprecedented power to impose fees on the cryptocurrency industry to fund new oversight. With fewer than 700 employees, the CFTC is housed in a modest building in northwest Washington. It's always been much smaller than the SEC, which has more than 4,500 employees, but these new tariffs could see it grow significantly.
Industry priorities for the CFTC may reflect its past leadership, including former President J. People like Christopher Giancarlo (also now at Wilkie), who have advocated and continue to support a "do no harm" approach to digital resources. Write a book about cryptocurrency, advise companies in the industry and earn a share of the French accolade for working with cryptocurrencies.
Would cryptocurrency companies still favor agencies if they had long arms and big teeth?
Liabo said he believes there is a misunderstanding within the cryptocurrency industry about what it means to be a friendly regulator.
"The CFTC is a friendly regulator because it's open to innovation," Liabo said. "Friendship does not mean that the CFTC does not enforce the law."
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In his public appearances, Behnam often comes across as an expert on cryptocurrencies and excited about their potential.
Last week at NYU, Behnam used privacy browser Brave and decentralized storage protocol Filecoin as examples of the potential of cryptocurrencies.
"I'm excited about Filecoin...it empowers us as individuals," Behnam said. "I think there's a bit of frustration with the way the internet works. If the new internet can empower us as individuals and allow us to monetize what we do and how we do it, it will be difficult to find someone who at least doesn't want to do it and have fun. Earn extra money."
However, a sign has emerged that reveals some of the CFTC's internal thinking. In its most recent executive action, the agency targeted Oki DAO for allegedly offering illegal business without proper government approval or regulatory oversight. This creates a potentially controversial precedent for holding participants in decentralized autonomous organizations accountable for their organizational misconduct.
"The CFTC is outside of its legal authority," said Jaret Seiberg, an analyst at Cowen, referring to Ooki DAO shares. "This reinforces our view that the agency will be a strong regulator if Congress gives it leadership on cryptocurrencies."
Behnam made comments at a meeting of top U.S. regulators this week, as the Financial Stability Supervisory Board released a report alleging that tainted government power over cryptocurrencies could threaten the entire financial system.
"I think we're going to work together -- the SEC and the CFTC -- so we can all use our existing enforcement powers until we provide new powers," Behnam said.
DeWaal argues that the CFTC has shown a willingness to be aggressive in its implementation, as has been the case with Tether, Bitfinex, and Coinbase Inc.
"If you add up the big names in the cryptocurrency industry, the big names have been involved in CFTC lawsuits rather than the SEC," Wall said.
"I worry about the struggle for political power in Congress's decision-making race -- the willingness to back each other up to see who is the toughest regulator," said Paul McCaffery, head of alternative equity sales at investment bank Bruett. kif and forest. “I am disappointed that the CFTC has decided to play with the SEC Application Playbook. We're hoping for a fair trial and fewer disturbed stands like I believe happened this week with Kim Kardashian's deal with Gensler.
SEC is here to stay
But even if the CFTC becomes the primary regulator, the industry will never break away from the SEC. If anything looks like a cryptocurrency investment business, the agency will continue to regulate it. And while the underlying laws still allow securities regulators to make important calls to identify tokens they deem securities, Gensler will regularly cover most cryptocurrencies.
Behnam apparently agreed with Gensler.
"I have no doubt that the vast majority of tokens in the digital asset ecosystem are security tokens," Behnam told NYU last week, stressing the importance of the two regulators working together to better regulate the cryptocurrency industry.
"Both organizations will have a role to play going forward," Dewal said.