Blockchain startup Ripple has shined a spotlight on what can happen when there’s a lack of a clear regulatory framework in which crypto can operate. The company is thinking about leaving the United States for greener crypto pastures where there is greater clarity on the rulebook by which they can operate.
Right on cue, Anthony Pompliano of the “Pomp Podcast” had the opportunity to discuss crypto regulation with Dr. Heath Tarbert, chairman of the Commodity Futures Trading Commission (CFTC), at the LA Blockchain Summit. The focus of their conversation was on crypto derivatives, which lent itself to addressing the broader regulatory landscape.
Chairman Tarbert has dedicated time to learning about blockchain technology because he wants to do right by the people who are building these systems. He has also made it a point to recruit people at the CFTC with tech experience and has even tapped some folks from the crypto space for his office.
The CFTC on CBDCs
Chairman Tarbert took the reigns at the CFTC from Christopher Giancarlo, the latter of whom is affectionately known as Crypto Dad. Chairman Tarbert seems to have a similarly friendly relationship with the cryptocurrency community, one that he appears to want to see grow stronger.
Pomp asked about the role that the US will play in technology innovation, including central bank digital currencies (CBDC), in response to which the Chairman said,
“Really where I stand is I want to see the United States lead in blockchain technology. For me, it’s not necessarily something that the government needs to be involved with directly. But there could be benefits to that as well. But I really want to see the US continue to support innovation in this space. Because I do see other countries coming in and starting to potentially take the lead.”
Chairman Tarbert wants to see the United States be out front on the technology for the future of the global financial system. He would like to see the U.S. dollar remain as the world’s reserve currency. But he believes that US payment mechanisms have not kept pace with technology and something must be done, whether the US moves toward a CBDC or just a more sophisticated payments system.
Security vs. Commodity
The CFTC chairman also touched on a topic that is near and dear to the crypto community’s heart, and that is the classification of digital currencies. He engages with the crypto community, and chief among the issues that he hears about is a lack of clarity surrounding how cryptocurrencies should be regulated. Chairman Tarbert said,
“And the first threshold is, is it a security or is it a commodity? Very different. They’re two divergent paths in the road. One leads to the SEC and a very different type of regulation. The other, if it’s a commodity, leads into our space, which is a more principled-based approach and I think in some cases is favored by many people in the crypto community.”
He agrees that the space needs much greater clarity so that as people are building products and experimenting, they know how these things will be regulated, which could be a game-changer on many different levels.
Covid rising in Europe, Trump cancels stimulus, stocks falling, election looming, Bitmex indicted, kucoin hacked, UK bans #crypto derivatives…… meanwhile #bitcoin is still maintaining its record run above $10,000! pic.twitter.com/AmIDIOtC2X
— Lark Davis (@TheCryptoLark) October 6, 2020
Despite the regulatory uncertainty that has persisted in the cryptocurrency space for years, the market has proven to be resilient. Once there is a clearer regulatory framework from which market participants can pull, there is no telling how far the space can go. In the meantime, it seems Chairman Tarbert is likely to win over the crypto community similar to how his predecessor, Crypto Dad, did.
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Source: Be In Crypto