- Rostin Behnam said bad players will be held accountable
- In March, the CFTC filed a lawsuit against Binance
CFTC Chairman Rostyn Behnam declaredthat decentralized cryptocurrency exchanges may be regulated by US law. According to him, the legislation already covers almost all digital assets. Behnam also added that in addition to the CFTC, exchanges can be regulated by the Securities and Exchange Commission, even if they are based on “home-made” protocols that are just code.
Behnam was asked if regulation could apply to DeFi exchanges that can operate autonomously or with minimal human involvement. Many people believe that because some platforms are completely decentralized, they cannot be regulated by law. Rostin replied:
“It’s easy to assume, ‘Oh, there’s no institution here, no person, it’s just a code, you can’t regulate it, it’s self-sufficient’, but that’s really the wrong set of questions. Is it really about what is offered and exposed to American consumers?” – he said.
He also added that there is one area where cryptocurrencies will be regulated by the CFTC to a small extent. We are talking about markets where tokens exist solely as a substitute for cash, and not as any other type of asset.
“I do not have the legal authority to regulate the cash markets for cryptocurrencies. We have very limited powers within the CFTC to regulate cash markets in the event of fraud or manipulation,” he said.
At the end of March, the CFTC sued Binance and CZ for regulatory violations.