CFTC learns a lesson from FTX collapse

U.S. lawmakers committee is set to examine CFTC Chairman Rostin Behnam about whether the agency has done enough to prevent the FTX crash.

A hearing on the matter has been scheduled under the title “Lessons Learned from the FTX Collapse and the Need for Congressional Action.” According to Reuters, the ground for such discourse may be Chairman and former FTX CEO’s repetitive meetings, to which Rostin Behnam himself recently admitted. Before filing for Chapter 11 bankruptcy, Sam Bankman-Fried tried to apply for directly clear customer trades during “many meetings” with CFTC.

СFTC has oversight of the derivatives markets, which are dominated by big players, and has the power to prevent fraud and misconduct. Although, the agency doesn’t have the right to regulate spot markets. It’s more of the responsibility of the SEC, Securities and Exchange Commission, which can crack down on individual investors.

Chairman Rostin Behman asked multiple times for widening regulatory authority for the agency. Nevertheless, Behnam adds that more clearly defined rules may not have prevented FTX collapse.

The FTX collapse has shaken the regulators. SEC plans to regulate the broader market because its Chairman, Gary Gensler, views all crypto as securities. At the same time, Rostin Behnam sees bitcoin and ether as commodities, for example, the same as gas, coil, etc.

Related: SEC Makes Its First Crypto Insider Trading Arrest

Today’s hearing, “Lessons Learned From the FTX Collapse and the Need for Congressional Action”, may shed light on further crypto regulation of the entire space. As well as determine whether the FTX collapse changed the idea of a crypto legal framework for both agencies. This will be decided in more than one session. The agenda will be discussed during the month. The committee also wants to hear from views of Sam Bankman-Fried, Alameda Research, and Binance.