The Chair of the US Commodities Futures Trading Commission (CFTC), Roston Behnam, believes 70-80% of cryptocurrencies are non-securities.
Behnam’s recent statement contrasts starkly with that of the Chair of the US Securities and Exchange Commission, Gary Gensler. In May, Gensler said many cryptocurrencies are securities under US laws.
The CFTC Chair’s remarks could favor the status of many cryptocurrencies in the market, including XRP, whose lawsuit with the SEC could end as early as July 13 or by the end of the month, as reported by ZyCrypto.
CFTC Chair Deems Most Cryptocurrencies as Non-securities
The CFTC Chair testified before the US Senate Committee on Agriculture, Nutrition, and Forestry earlier this week, where he reiterated that Bitcoin and Ether were commodities.
During the hearing, Behnam referenced a July 3 ruling by an Illinois Court classifying BTC and ETH as commodities. The verdict was part of a $120 million Ponzi scheme case.
Today, I testified on digital commodity assets in front of the Senate Agriculture Committee. Read my remarks at https://t.co/JojHNdQoVh
— Rostin Behnam (@CFTCbehnam) July 10, 2024
The CFTC Chair stated that 70% to 80% of cryptocurrencies are non-securities. Therefore, the CFTC must be granted regulatory oversight over these crypto assets under the Commodities Exchange Act.
Behnam’s testimony could end the years-long debate on which cryptocurrencies are securities and which are commodities. The SEC has filed lawsuits against cryptocurrency exchanges like Coinbase and Binance for selling unregistered securities. It is also suing Ripple for selling XRP as an unregistered security.
The CFTC Chair believes that the lack of a clear regulatory framework and regulators’ inaction pose a significant risk to investors and financial markets.
“Our current trajectory is not sustainable,” Behnam noted, adding that legislation at the federal level was urgently required.
CFTC Is Qualified To Regulate Crypto
Behnam also noted that the CFTC was uniquely positioned to regulate digital assets not deemed as securities. He stated that the agency was ideally suited to create a regulatory framework matching the unique risk profile of crypto assets. This includes provisions for anti-money laundering, know-your-customer, and customer identification.
According to Behnam, failing to regulate digital assets to avoid legitimizing them was a “flawed notion” that any regulatory agency should not adopt.
In May, billionaire investor Mark Cuban advocated for the CFTC to regulate crypto assets. At the time, Cuban stated that Gensler’s anti-crypto stance would cost Joe Biden the US Presidency.
“You could do the better option and assign all crypto to be regulated by the CFTC. They actually know what they are doing,” Cuban stated.
If the CFTC is granted oversight over the crypto industry, assets such as XRP, whose regulatory status remains uncertain, are poised to benefit. The XRP case is nearing its end, and the CFTC Chair’s statements could add weight to Ripple’s defense arguments.
XRP was trading at $0.443 on July 11 at 02:36 a.m. after a slight 1% gain.
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