Good for Bitcoin and Ethereum: CFTC introduces new regulatory framework

  • The Commodity Futures Trading Commission published a “Strategic Plan” that aims to create a new regulation for Bitcoin (BTC).
  • The regulator will be guided by the principled approach proposed by its chairman, Heath Tarbert.

The Commodity Futures Trading Commission (CFTC) reached a consensus among the political parties to create and approve the “2020-2024 Strategic Plan”. The U.S. regulator has set itself the goal of improving innovation and regulation for market participants. In that sense, the regulator stated that it will address:

(…) the risks and opportunities arising from “21st century commodities”. We will develop a holistic framework to promote responsible innovation in digital assets.

Bitcoin 2024: New legal framework could increase adoption

The U.S. regulator recognized that Bitcoin and Ethereum are part of this “new commodity” category. Therefore, in the next few years both cryptocurrencies could enjoy full approval from a U.S. institution and legal framework. Consequently, a new era of adoption could arrive in the coming years.

In its strategic plan the CFTC recognizes that it still has a long way to go in this area. It further states that the way it regulates matters as much as what it regulates. Therefore, the institution will be guided by the following:

(…) we will be guided by the important results of the resistance, avoiding systemic risk, and improving the integrity of the derivatives markets and advancing the interests of Main Street.

In addition, the regulator will implement the new regulatory approach proposed by its chairman, Heath Tarbert. In an attempt to maintain America’s leadership in innovation, Tarbert proposed a system of principles to replace fixed rules. That way, the regulator will have more freedom to regulate new assets such as cryptocurrencies while no longer applying obsolete regulations that prevent it from doing its job. The CFTC stated that for the Strategic Plan:

Follow us for the latest crypto news!

(…) we will emphasize the principles to which we expect the industry to adhere. Where appropriate, a principled approach can help our markets remain fair, innovative and vibrant.

The CFTC president was pleased with the unanimous approval he received for the plan. He also noted that, unlike previous years, the regulator was able to create a short and concise document on the objectives of the CFTC. In that sense, Tartbert stated:

Subscribe to our daily newsletter!

          No spam, no lies, only insights. You can unsubscribe at any time.

It will guide the last of the CFTC’s pending issues to completion and better position the agency to address the unwritten future.

As part of the Strategic Plan, the regulator will seek to strengthen the derivatives market. The CFTC will promote transparency and liquidity for assets under its jurisdiction. This could reduce the number of cryptocurrencies and digital assets that obtain the classification of commodities, such as privacy coins Monero, Dash, Zcash. As reported by CNF, this issue is one of the most important currently in crypto space.

Crypto News Flash does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products, or other materials on this page. Readers should do their own research before taking any actions related to cryptocurrencies. Crypto News Flash is not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods, or services mentioned.

About Author

Reynaldo Marquez has closely followed the growth of Bitcoin and blockchain technology since 2016. He has since worked as a columnist on crypto coins covering advances, falls and rises in the market, bifurcations and developments. He believes that crypto coins and blockchain technology will have a great positive impact on people's lives.

Comments are closed.