Abstract
Commodity Futures Trading Commission (CFTC) crypto enforcement rose to record levels in 2023, prompting applause from some observers and criticism from others. In fact, the CFTC’s enforcement agenda is not out of step with other federal agencies such as the Securities and Exchange Commission (SEC), which has also been incredibly active in the crypto industry. It might seem that this is bad news for crypto, given that both the CFTC and SEC have been angling to become the primary regulator for these new assets. In reality, proof that the CFTC is active in enforcing the law against crypto entrepreneurs and others who violate anti-fraud mandates or otherwise ignore clear requirements, may make it more likely that legislators will view the agency as a responsible regulator. Even those who have previously stated a preference for the SEC as primary regulator may decide that shared responsibility would work, particularly because the SEC has not been able to create a regulatory regime with which crypto businesses have been willing and able to comply. If Congress acts to require both the CFTC and SEC to impose reasonable and equivalent requirements regarding disclosure and fair-trading activities, perhaps with the assistance of a self-regulatory organization (SRO), an effective regulatory regime might be possible. With equivalent requirements in place regardless of whether cryptoassets are to be regulated by the CFTC or SEC, wasteful litigation can be minimized. An SRO could be particularly helpful because it is likely to have the appropriate expertise and motivation to create reasonable and workable requirements, and the cost of oversight could be shared by members of the SRO rather than by taxpayers.
Recommended Citation
Carol R. Goforth, How Active CFTC Enforcement Could Benefit Crypto, 45 Pace L. Rev. 343 (2025)DOI: https://doi.org/10.58948/2331-3528.2107
Available at: https://digitalcommons.pace.edu/plr/vol45/iss2/3
Included in
Administrative Law Commons, Banking and Finance Law Commons, Law and Economics Commons, Securities Law Commons
