CFTC Chairman Encourages a Do No Harm Approach to Cryptos

Regulatory changes shaped the crypto market in 2018. Last year, we’ve seen a number of altcoins enter the picture especially after seeing the rise of Bitcoin to near $20K level.

Some may have considered regulatory clarity as a necessity in order to get institutional investors involved. And considering the participation of ICE, Goldman Sachs, and other institutional investors, it seems that the market is definitely making progress.

But of course, there are countries such as China that has a strict approach to cryptocurrencies. It has recently renewed interest in taking down crypto-related activities. Chinese regulators have recently banned malls and hotels to host crypto-related activities.

On the other hand, there are countries such as Japan that approached the crypto market with an open mind. Though it has raised the bar in accepting crypto exchanges, it was done in order to protect investors.

Do No Harm Approach

If you are going to ask Chairman of US Commodity Futures Trading Commission (CFTC) J. Christopher Giancarlo, he thinks that regulators should avoid stopping the development of the market. He believes that regulators should be tolerant when it comes to the crypto market. He even compared the crypto market to the internet noting that the World Wide Web flourished because regulators didn’t step in heavily and applied a “do no harm” approach.

He said that “I’m advocating the same approach to cryptocurrencies and all things having to do with this new digital revolution of markets, and of currencies, and of asset classes”.

Though he believes that there should be leniency applied by regulators, he also recognizes the risk of fraud and manipulation. And these things should be considered when it comes to making policies. He said that “When it comes to fraud and manipulation, we need to be strong. When it comes to policy making, I think we need to be slow and deliberate and well informed”.

The CFTC has been known for providing a positive opinion regarding the crypto industry. Rostin Benham has been known saying in June that cryptocurrencies are “here to stay”. He said that “Virtual currencies may—will—become part of the economic practices of any country, anywhere”. He also added that “Let me repeat that: these currencies are not going away and they will proliferate to every economy and every part of the planet”.

SEC Echoing “Do No Harm” Position

This opinion regarding crypto regulations has been echoed by an analysis by the new SEC commissioner Elad Roisman. Roisman stated that he favors a “fair” and “transparent” approach when it comes to working with the crypto industry.

The SEC is set to make a decision regarding the Bitcoin ETF applications by VanEck and SolidX this month. Will there be a Bitcoin ETF this year? For some, it is believed that a Bitcoin ETF is going to eventually happen but by next year. There have already been a number of rejections by the agency including that of the Winklevoss twins. It was the second time that the Winklevoss twins submitted their Bitcoin ETF application only to be rejected again. The agency noted that the possibility of price manipulation.