March 14, 2019, | AtoZ Markets - U.S. Commodity Futures Trading Commission (CFTC) Chairman J. Christopher Giancarlo has said the agency’s Fintech innovation hub LabCFTC is the regulator’s internal stakeholder in a landscape of exponential technological change and market evolution. In his speech on March 14th at the 44th Annual International Futures Industry Conference, CFTC Chair made bullish crypto remarks on blockchain mentioning them as the phenomenon for the transformation of financial markets.
CFTC Chair Bullish Crypto Remarks
According to Giancarlo, the disintermediation of traditional business models as a key factor that challenges existing regulatory models which might isolate blockchain and cryptocurrencies as two key phenomena that are transforming today’s markets. To respond to the challenge that this change poses for federal regulators, Giancarlo noted that a cornerstone of the CFTC’s approach was the establishment of its own internal stakeholder.
According to him, LabCFTC had over 250 separate interactions with both big and small innovators, conducting lab hours across the U.S. and internationally. He believes that the lab is not a regulatory sandbox and does not exempt firms from CFTC rules, but rather aims to provide an internal and external technological focus.
CFTC Chairman J. Christopher Giancarlo was quoted that:
“Internally, it means explaining technology innovation to agency staff and other regulators and advocating for technology adoption. Externally, that means reaching out and learning about technological change and market evolution, while providing a dedicated liaison to innovators.”
Moreover, Giancarlo also highlighted the lab’s FinTech cooperation agreements with global regulators which were held in London, Singapore, and Australia. He notably aligned the hub’s creation and work as part of a nationwide trend across agencies. He also said that every US federal financial regulator has either developed or developing a program similar to LabCFTC.
Prioritizing cryptocurrency and Blockchain
Last month, the CFTC planned to examine stablecoins and cryptocurrencies. Specifically for Ethereum, the CFTC opened doors for industry experts' comments and opinions on the Ethereum blockchain. Similar to the US commodities market regulator, the SEC is also in favor of creating a suitable market for the cryptocurrency and blockchain as its chairman vouched for self-regulation of the cryptocurrency market.
Aside from the Lab, Giancarlo noted that the CFTC is embracing market-based solutions for innovation, as its authorization of Bitcoin futures is striving to become a quantitative regulator. This might able to conduct independent market data analysis across different data sources, including decentralized blockchains and networks.
Additionally, LabCFTC’s two FinTech educational primers have been devoted to cryptocurrencies on October 2017 and smart contracts on November 2018. In December, the lab solicited public and industry comments on the Ethereum blockchain network as part of its evaluation of authorizing Ethereum futures contracts.
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