The CFTC chairman confirmed that Defi platforms will also go through the regulation system, whether they are fully decentralized or not.
The Commodity Futures Trading Commission (CFTC) is the second biggest regulatory body, which regulates the crypto sector in the US jurisdiction under existing traditional commodities law. Over the past couple of years, the CFTC body confirmed that its authority is very small to regulate the crypto sector.
Recently CFTC chairman Rostin Benham said that Decentralised exchanges & related crypto services can be easily regulated under the jurisdiction of the US, no matter if they are only code or running on decentralised software.
Rostin said that people call Defi a fully decentralized financial service, where there is no backend entity/body/institution but noted that there is a group of people & firms that launch the Defi protocols.
Further, the CFTC Chairman said that it is regardless of how the defi platform works but it is the most important thing that the platforms are offering to the US customers.
“It’s really about what are U.S. customers being offered and exposed to. And who is either the individual or group of individuals who set up that entity, that code, to offer those products?”, the CFTC chairman said.
Rostin noted that the majority of the Crypto businesses are already under the regulatory authority of the United States Securities and Exchange Commission (SEC) but there is a task on the Defi sector, whether the regulation authority will go under the CFTC or SEC.
The statement passed by the CFTC Chairman indirectly hinted that huge strict regulation & enforcement action against the crypto sector is on the way.
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