The Trump administration is looking to shift digital asset regulation from the SEC to the CFTC, as reported by Fox Business. This move would give the CFTC oversight of spot markets for digital commodities like Bitcoin and Ethereum, which make up a significant portion of the global crypto market.
Supporters of the proposal argue that the CFTC’s experience in derivatives markets makes it better suited to regulate digital commodities compared to the SEC. The plan is part of a broader effort by President-elect Donald Trump to restructure financial regulation in the US, with a focus on fostering innovation.
However, for the CFTC to take on this new role, it would require Congressional approval and increased funding. The agency’s current budget and staff size are significantly smaller than the SEC’s, raising concerns about its ability to effectively regulate the growing digital asset market.
Former CFTC Chairman Chris Giancarlo, a vocal advocate for clearer crypto regulations, emphasized the importance of precise legislative language to ensure that the new mandate does not have unintended consequences on other commodity markets. While the proposal has gained support within the crypto community, some experts and traditional CFTC stakeholders are wary of potential spillover effects.
Overall, the potential shift in digital asset regulation from the SEC to the CFTC represents a significant change in US crypto policy. It remains to be seen how this proposal will unfold and what impact it will have on the broader financial regulatory landscape.