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【Better Markets Criticizes CFTC as Unsuitable for Regulating Retail Crypto Trading】
The nonprofit financial reform advocacy organization Better Markets criticized CFTC’s proposed framework for retail crypto trading, arguing that its investor protections would be weaker than those of SEC。CFTC issued a public request for comment on Monday regarding a framework for retail crypto transactions involving margin, leverage, or financing. Benjamin Schiffrin, director of securities policy at Better Markets, said that, unlike SEC CFTC lacks investor-protection responsibilities and its mission is to regulate the commodities and derivatives markets, historically dominated by large institutions with little retail participation. Therefore,CFTC is the wrong agency to regulate crypto-asset trading by retail customers. Better Markets also questioned CFTC’s claim that Congress intended it to regulate such transactions. Schiffrin noted that the statutory authority cited by CFTC was originally established to address fraud in leveraged precious-metals transactions and does not indicate that Congress intended the agency to become the primary regulator of retail crypto trading. He also criticized the framework under consideration for potentially allowing affiliations among market participants, which previously contributed to the collapse of FTX At the same time, Schiffrin criticized CFTC Chair Mike Selig’s remarks about making the United States the global crypto capital, saying he had not explained why that would be a good thing, and stating that crypto still lacked real-world use cases 18 years later. Nate Geraci, president of NovaDius Wealth Management, countered that the crypto industry is simply seeking clear rules and, if Congress cannot provide them,CFTC and SEC may have to assume this responsibility.