Rostin Behnam, chair of the CFTC, urged Congress to regulate cryptocurrencies and predictive election betting at the SIFMA conference.
Rostin Behnam, who serves as the chair of the Commodity Futures Trading Commission, recently brought attention to the problem of Congress’s lack of action on regulating cryptocurrencies and betting on predicting election outcomes. During the SIFMA meeting, Behnam emphasized the need for specific legislative regulations for these rapidly growing industries.
CFTC Calls for Urgent Action on Crypto Regulations and Election Betting Laws
During the annual conference of the SIFMA, the Chair of the Commodity Futures Trading Commission (CFTC), Behnam, continued to emphasize his earlier request to Congress to offer directives regarding its position on the regulation of cryptocurrencies.
In spite of this, he expressed his disapproval of the current legal framework, with particular reference to the indications of rapid mobility and the increasing popularity of digital assets. According to him, the framework does not possess sufficient coherence to adequately govern the markets for cryptocurrencies.
Furthermore, Behnam highlighted that the system was deficient in certain areas due to the absence of suitable crypto regulation. He brought to his attention the issue of spot market regulation and the potential impact of blockchain and tokenization technology on financial markets.
“Digital assets come top of mind when it comes to regulating spot markets, but the broader question is, what is blockchain and tokenization going to do for financial markets?”
He stated that Behnam urged Congress to provide more specific guidance on these issues. The Chair of the Commodity Futures Trading Commission (CFTC) expressed skepticism over the probability of any serious legislative action on crypto rules this year, despite the urgent need for laws that are more transparent.
Parliamentary sessions have limited time, and other pressing issues like the approval of a federal budget take precedence. He made the suggestion that potentially major advancements could have to be postponed until after the elections in 2024. Furthermore, Behnam advocated for the clarification of the legislative situation surrounding predictive election betting.
The Commodity Futures Trading Commission (CFTC) has found itself at the center of this issue, notably in relation to prediction markets, which supply consumers with the opportunity to wager on the results of events such as elections. Behnam pointed out that although these markets offer useful forecasting tools for a variety of industries, they also present ethical and legal difficulties when it comes to elections.
Consistently, the Commodity Futures Trading Commission (CFTC) has maintained that contracts betting on election outcomes are illegal. Behnam expressed his dissatisfaction with the situation, despite the agency receiving the role of an “election cop.” He suggested that Congress should establish more clear legal norms to govern the regulation of such markets.
“This is a classic area where Congress should weigh in.”
Furthermore, he mentioned that a recent legal dispute between the Commodity Futures Trading Commission (CFTC) and Kalshi, a platform that facilitates prediction markets, has escalated the controversy surrounding election betting. During the previous year, the commission decided to prevent Kalshi from providing electoral contracts, citing the fact that such offerings were contrary to the public interest.
In response, Kalshi filed a lawsuit against the commission, leading to an ongoing legal conflict.In September 2023, a federal court ruled that the commission’s efforts to prevent Kalshi from receiving election contracts exceeded its statutory authority. The Commodity Futures Trading Commission (CFTC) has continued to oppose the verdict, and they filed an appeal just one month ago.
