CFTC’s Four-Year Strategic Plan Hints a Comprehensive Crypto Regulatory Framework


The U.S Commodities Futures Trading Commission (CFTC) is set to develop a comprehensive crypto regulatory framework according to its recently released 2020-2024 strategic plan. This futures and derivatives regulator plans to have made significant progress in the next four years as digital assets debut in all forms, including complex derivatives that fall under the CFTC watch.

According to the CFTC, this approach will enhance responsible innovations within the digital currency space. The plan reads,

“We will develop a holistic framework to promote responsible innovation in digital assets.”

This initiative was first approved in May and had been open for public comments until yesterday when it was published. With this development, the CFTC plans to increase America's integrity and resilience in the digital currency space. The U.S derivatives watchdog has also noted it will take stricter actions on entities or persons that violate the current market underpinnings and those set for implementation at a later date.

At the moment, the CFTC has begun issuing a designated contract market (DCM) licenses to digital asset exchanges running crypto-based futures. Notable beneficiaries of this license include TD Ameritrade's ErisX and Bitnomial; both offer Bitcoin futures. In addition to this oversight, CFTC further recognizes BTC and ETH as commodities which gives a case for their underlying futures. The commission's chairman, Heath Tarbert, has since expressed optimism in the next regulatory framework development phase,

“I am proud of the hard work that went into developing the plan and the unanimous support it ultimately received. It will guide the last of the CFTC’s unfinished business to completion and better position the agency to tackle the unwritten future.”

While the CFTC is forward-looking to digital assets, Tarbert recently said that success in scaling the derivative market is dependent on its bigger brother, SEC. According to him, clarity from the SEC will spur the adoption of crypto-based in the U.S financial markets under CFTC's regulatory framework,

“Once you start seeing more clarity on whether something is or is not a security, you will start seeing more futures listed on digital assets.”

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