CFTC Chair Calls for Federal Legislation to Regulate Digital Commodities

The chairman of the Commodity Futures Trading Commission (CFTC), Rostin Behnam, testified before the U.S. Senate Committee on Agriculture, Nutrition, and Forestry on Wednesday, stressing the necessity for oversight of digital commodities, particularly bitcoin and ether.

The chairman of the Commodity Futures Trading Commission (CFTC) testified before the U.S. Senate on Wednesday, highlighting the need for federal legislation to regulate digital commodities like bitcoin and ether. He emphasized the market volatility, fraud, and recent court ruling on the status of the two largest cryptocurrencies as commodities.

CFTC Chair Pushes for Digital Commodity Legislation, Highlighting Bitcoin, Ether Status as Commodities

Commodity Futures Trading Commission (CFTC) Chairman Rostin Behnam attended a U.S. Senate Committee on Agriculture, Nutrition, and Forestry hearing on Wednesday to discuss the need for oversight of digital commodities. He highlighted the significant evolution and volatility of the digital asset market.

Testifying before the Senate panel, Behnam stressed the urgent need for comprehensive federal legislation to regulate the digital commodity market, highlighting the numerous market scandals and fraudulent activities. He also pointed out the recent court ruling that reaffirmed the status of bitcoin and ether as commodities.

“Just last week, a District Court in the Northern District of Illinois entered summary judgment in favor of the CFTC in a case involving fraud by an unregistered entity that promised steady returns in digital asset commodities such as bitcoin and ether,” Behnam stated. “In its decision, the court reaffirmed that both bitcoin and ether are commodities under the Commodity Exchange Act.”

The CFTC chief noted that it has been almost nine years since the CFTC first brought an enforcement action in connection with an illegal bitcoin operation. “Since that time, the agency has been aggressive in using our powerful, but limited anti-fraud and anti-manipulation authorities,” he added.

“In total, the CFTC has brought over 135 digital commodity cases resulting in billions in penalties and restitution. All along, CFTC enforcement staff has worked closely with our civil and criminal law enforcement partners at the federal and state levels,” Behnam continued.

He also pointed out that the escalating rate of digital asset enforcement cases since 2020 mirrors the accelerated and sustained adoption of digital assets by U.S. investors.

Despite the CFTC's efforts, Behnam highlighted the limitations of their current anti-fraud and anti-manipulation authorities, especially in the spot market for non-security tokens. He called for new legislative authority to close the regulatory gap.

Furthermore, the CFTC chairman emphasized the importance of international coordination and regulatory certainty to prevent exploitation by bad actors while supporting innovation and economic benefits.

“We must continue working together to ensure that U.S. markets remain the safest, most competitive, and most innovative in the world,” Behnam concluded.

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