The U.S. CFTC Regulator Shows Interest In Understanding Ethereum Blockchain Network
Commodities regulator, the U.S. Commodities and Futures Trading Commission (CFTC) on Tuesday, December 11, said that it is willing to explore the Ethereum blockchain technology and the entire ecosystem built around it.
In an official press release, the regulator notes that “The Commodity Futures Trading Commission (CFTC) is seeking public comment and feedback in order to better inform the Commission’s understanding of the technology, mechanics, and markets for virtual currencies beyond Bitcoin, namely Ether and its use on the Ethereum Network.”
In addition to helping the Commission understand these emerging technologies, the CFTC also hopes that the public comments and information received will prove beneficial for the agency’s own FinTech initiative - LabCFTC.
The CFTC also published its “Request for Input (RFI)” giving the respondents a 60-day time to submit their answers through the Federal registers. Respondents can submit their answers through email, mail or hand delivery.
The RFI will also inform about CFTC’s oversight on the Ethereum network along with other derivative markets relating to cryptocurrencies. It notes: “The input from this request will advance the CFTC’s mission of ensuring the integrity of the derivatives markets as well as monitoring and reducing systemic risk by enhancing legal certainty in the markets. The RFI seeks to understand similarities and distinctions between certain virtual currencies, including here ether and bitcoin, as well as ether-specific opportunities, challenges, and risks.”
The Federal Register document also highlights some questions on the Ether tokens and its supporting network. The questions also aim to seek information regarding the network technology, its purpose, its governance, regulatory oversight, the cybersecurity, and custody.
The questions also ask about some of the upcoming improvements in the Ethereum network. This includes proof-of-stake, scalability issues, and other things. It also asks about whether the Ethereum network allows agencies like the CFTC to perform audit about the deposits and transactions done.
It also asks that if the derivative contracts are to be introduced on the Ethereum network, how would it modify or change the incentive structure for the proof-of-stake model.
The CFTC is one agency which has remained open to embrace the FinTech and shown the willingness to understand more about the decentralized blockchain technology. Last month in November, CFTC chairman J. Christopher Giancarlo said that blockchain can be used to automate regulations and ensure its implementation much effectively.
Earlier in October, Giancarlo also said that for the crypto markets to mature, institutional adoption is also necessary.