After years of positioning itself as the dominant regulatory force in the digital asset space, often at odds with crypto advocates, the Securities and Exchange Commission (SEC) faces a significant shift in jurisdictional control.
Amidst mounting frustration with the agency’s combative approach, the incoming Trump administration is pushing to expand the Commodity Futures Trading Commission (CFTC) ‘s powers, granting it jurisdiction over the $3 trillion crypto market.
More CFTC Oversight
As Trump prepares to take office, the influence of the cryptocurrency industry within Republican politics could pave the way for an expanded role for the CFTC.
Sources familiar with FOX Business revealed that the Trump team’s plans suggest that the agency may soon oversee spot markets for digital assets classified as commodities, such as Bitcoin and Ethereum, along with the platforms enabling their trading.
With over 50 million people holding digital assets, key members of the incoming administration argue that lighter regulatory frameworks are essential to boost innovation in the space, particularly in advancing blockchain technology, which promises to streamline business operations by eliminating expensive intermediaries.
In a statement to FOX Business, former CFTC Chairman Chris Giancarlo said,
“With adequate funding and under the right leadership, I think the CFTC could hit the ground running to begin regulating digital commodities on day one of Donald Trump’s presidency.”
Ending the Crypto Turf War
No regulatory agency has explicit authority over these transactions. Rostin Behnam, the departing head of the CFTC, repeatedly asserted that the majority of crypto assets are classified as commodities under existing rules. He also noted the ongoing regulatory battle with the SEC for control over the crypto industry.
Hence, if Congress approves the proposition and the CFTC is tasked with overseeing the industry, this would effectively end years of regulatory uncertainty and the SEC’s alleged overreach.
The securities regulator, under President Biden, has drawn sharp criticism for its intensified enforcement actions. In 2023 alone, 46 lawsuits were filed against crypto entities—this represented a 53% surge from the previous year and the highest number recorded since the agency began monitoring crypto in 2013, according to data.
High-profile cases include allegations against Binance and Coinbase, where the SEC accuses them of running unregistered exchanges and violating securities regulations. A lawsuit against Binance CEO Changpeng ‘CZ’ Zhao also exists.
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