No way to police all cryptocurrency fraud: US regulator CFTC
1 min read . Updated: 24 May 2023, 06:27 AM IST
PremiumCryptocurrency cases account for about 20% of the agency's portfolio, including recent civil cases against the exchanges Binance and FTX.
It is impossible to effectively police all cryptocurrency fraud, due to the abundance of cases, a top U.S. regulator said on Tuesday.
Around 20% of the agency's portfolio is dedicated to cryptocurrency-related cases, including recent civil actions against exchanges like Binance and FTX, a commissioner from the Commodity Futures Trading Commission (CFTC), Christy Goldsmith Romero, stated.
"There's just a lot of fraud in the space," Goldsmith Romero said at a white collar crime conference at the New York City Bar Association, as quoted by Reuters. "There's just no way we can police all the fraud, but we've got to do something."
She said the regulator is actively working on several major cases in this area.
Meanwhile, CFTC Chairman Rostin Behnam has sought greater authority from lawmakers for the agency to oversee spot crypto markets.
Goldsmith Romero rejected the idea of a "turf war" between the CFTC and the SEC over crypto regulation but acknowledged the challenges of regulating new industry products. She emphasized that both agencies were still grappling with understanding the complexities of the crypto market.
Additionally, she advised crypto companies not to perceive the CFTC as a potentially more lenient regulator compared to the well-funded SEC.
"I don't like the idea that somehow the CFTC is light touch," Goldsmith Romero said. "'Light touch regulator' would never be written on my tombstone."
In March, the CFTC sued Binance and Changpeng Zhao, its founder and CEO, for allegedly operating a sham compliance program.
Zhao has called the complaint an "incomplete recitation of facts."
The CFTC case against now-bankrupt FTX accuses the exchange and founder Sam Bankman-Fried of causing the loss of more than $8 billion in customer deposits.
Bankman-Fried has pleaded not guilty to related criminal charges from the U.S. Department of Justice.
(With inputs from agencies)