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Crypto News: Chairmen From The SEC And CFTC Talk Crypto Regulation At ISDA Meeting



Crypto News: Chairmen From The SEC And CFTC Talk Crypto Regulation At ISDA Meeting

Crypto News – The International Swaps and Derivatives Association (ISDA) held its annual conference in Madrid on Wednesday.

Chairman Gary Gensler of the Securities and Exchange Commission (SEC) and Chairman Rostin Behnam of the Commodity Futures Trading Commission (CFTC) were both featured as keynote speakers at the event, with Behnam speaking in the morning and Gensler speaking in the afternoon.

“A request for a revised order of registration as a derivatives clearing organization (DCO) by an entity intending to offer non-intermediated clearing of margined products to retail players,” Behnam said, clearly referring to FTX US’s request.

“As other registered entities have expressed interest in exploring similar models, and given the potential impact on clearing members and FCMs [futures commission merchants]” […] it is paramount to be transparent and provide an opportunity to hear from the public,” Behnam said, plugging the CFTC roundtable on the subject coming up later this month.

FTX CEO Sam Bankman-Fried was present at the conference and participated in a fireside talk a few hours later, so he might have been listening while Behnam spoke.

Behnam went on to recall his February Senate testimony and say that:

“I will continue advocating for and supporting legislative authority for the CFTC to develop a regulatory framework for the cash digital asset commodity market.”

The CFTC now exclusively controls futures markets, however it has had enforcement jurisdiction over cash markets in the past, like as the punishment it issued on Coinbase in 2021 for illegal exchange volume reporting and “self-trading.”

In his much shorter lecture, Gensler discussed “the confluence of crypto assets and derivatives.” He said:

“If platforms — whether in the decentralized or centralized finance space — offer security-based swaps, they are implicated by the securities laws and must work within our securities regime.”

As it creates legal rules for crypto derivatives, Gensler emphasized the necessity for the ISDA “to realize that if the underlying asset is a security, the derivative must conform with securities legislation.”



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