The former chairs of two top US financial regulators think their old agencies need to work hand in hand to regulate crypto.
Jay Clayton, the former chair of the Securities and Exchange Commission (SEC), and Timothy Massad, the former chair of the Commodity Futures Trading Commission (CFTC), co-wrote an opinion piece about domestic crypto policy in the Wall Street Journal this week.
Clayton and Massad say their former agencies’ recent enforcement actions against top crypto firms aren’t likely to increase investor protections in the sector any time soon.
“For these reasons, we continue to believe that other actions, besides litigation, should be taken if we are to reach an appropriate end.
Most notably, the SEC and CFTC should jointly develop basic investor and market protection standards for trading platforms as they exist today. The agencies could act directly or through a self-regulatory organization, shifting funding responsibility to the industry. Having Congress mandate this approach would be even better.”
The former top regulators note that more than 90% of spot trading volume occurs on centralized platforms, and they argue their strategy would increase investor protection in that space.
“Simply eliminating ‘wash trading’ — where someone trades with themselves or an affiliate to inflate the price or trading volume of an asset, and which has been estimated to represent a substantial portion of trading volume, particularly offshore — would be a huge improvement.”
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The post Former SEC and CFTC Heads Say Both Agencies Should Work Jointly To Regulate Crypto: Report appeared first on The Daily Hodl.
