The Chairman of US CFTC (Commodity Futures Trading Commission) Heath Tarbert, urged for a principle-based regulation for cryptocurrencies. He stated that with this approach, regulating the digital assets will allow a period of development and observation which could be more appropriate to adopt more targeted rules as we are reading in our cryptocurrency news.
In today’s altcoin news, we see that Tarbert delivered his remarks on crypto regulation in his op-ed which was published on the official CFTC website on November 19. The Chairman of US CFTC noted that the term ‘’principles-based regulation’’ does not apply only to the light-touch approach of deregulation but that this is actually far from it. He pointed out that this approach involves moving away from detailed rules to relying more on a higher level including the broadly-stated principles’’ to define the standards for regulated companies and products.
To make the point, Tarbert quoted the former British Prime Minister Winston Churchill who said:
“If you make 10,000 regulations, you destroy all respect for the law.”
According to Tarbert, the regulators should understand the potential outcomes and risks of digital assets before enforcing the rules and he argued:
“What we don’t want to do is take a heavy hand and snuff out innovation altogether. Given the rapid pace of innovation and the markets supporting it, taking a principles-based approach to regulating digital assets and other fintech products would permit a period of development and observation. After we fully understand the outcomes and potential risks of digital assets, it may be appropriate to adopt more tailored and targeted rules or a more balanced combination of principles and rules.
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While expressing the supportive stance for the development of the technology, Tarbert still devoted a lot of attention to the risks that emerge within the industry. He noted:
“Our willingness to allow innovation to develop should not be confused with a tolerance of fraudulent behavior or a so-called light-touch approach.’’
He added that the CFTC is now working out how the basic aspects of principles-based regulation can be applied for crypto exchanges. His remarks are much similar to his predecessors’ Chairman Giancarlo when he argued that crypto needs a ‘’ do no harm’’ approach from the regulators in order for it to be successful.
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