The US Commodity Futures Trading Commission (CFTC) drew two pieces of crypto-related staff guidance on Friday and further streamline its approach to crypto control.
The first advice that was lifted on Friday was staff advisory no. 18-14, Advisory with regard to virtual currency -DeDivatproduct teaching. Originally published in May 2018, the advisory guidelines established crypto-related derivatives, including requiring reporting companies to maintain “Close coordination with [the] CFTC Surveillance Group ”and the establishment of a large trader threshold of five Bitcoins (or the equivalent value of other cryptocurrencies), among other proposals. On Friday, CFTC published a letter saying that” additional staff experience “and” increased market growth “had made the guidance unnecessary.
The second advice, staff advisory no. 23-07, Review of risks associated with the extension of DCO -CLEARING OF DIGITAL ATTEMSfrom May 2023, ”Highlight[d] Compliance “with CFTC rules due to” hieghtened cyber and other operational risks that may be associated with digital assets. “This guide was withdrawn by another reason-to clearly treat crypto-related derivatives and their issuers fairly, CFTC suggested.
CFTC’s sister -regulating agency, US Securities and Exchange Commission (SEC), has revised his approach to crypto regulation since President Donald Trump joined in January. Under the new management of acting chairman Mark Uyeda, SEC has created a crypto -task force that has led its transformation, engagement with the industry and backed from a number of litigation and investigations in cryptic businesses that began under the leadership of former President Gary Gensler.
Although SEC’s rapid transformation may be flashers, CFTC is currently undergoing its own transformation that streamlines its regulatory strategy as part of acting chairman Caroline Pham’s plan for the agency “Return to the basics.” In addition to the two pieces of the dropped crypto-related guidance, the Agency has lifted other non-Crypto-related staff advisers and reviewed its enforcement department, cutting down a number of specialized enforcement teams to only two who promised that a simplified enforcement department would be more effective and “stop regulation by enforcement.”
Liz Davis, a Washington, DC-based partner in Davis Wright Triache LLP and a former Chief Trial Attorney in CFTC’s enforcement department, Coindesk told her that she sees the two pieces of abolished crypto-guidance as in accordance with Pham’s “Back to Basics” approach to operating the agency.
But Davis also suggested that the changes could be linked to a major restructuring that is taking place at CFTC.
“They are probably reviewing an reorganization with all that is going on with [the Department of Government Efficiency (DOGE)]”Davis said, adding that Pham’s ongoing efforts to” centralize “CFTC’s operations could help facilitate a reorganization.
