The move would give the SEC less power to manipulate cryptocurrency initiatives
President-elect Donald Trump’s administration is reportedly considering shifting the oversight of cryptocurrency exchanges and spot markets for digital assets classified as commodities to the Commodity Futures Trading Commission (CFTC). This potential regulatory change could mark a significant departure from the current approach led by the Securities and Exchange Commission (SEC).
Sources suggest that Trump’s team views the SEC’s actions as overly restrictive, arguing that its enforcement against crypto firms has stifled innovation in the US. By placing the CFTC in charge, the administration aims to create a regulatory environment perceived as less stringent, potentially fostering industry growth. The crypto sector has long advocated for the CFTC as its preferred regulator, citing the agency’s historically lighter touch and fairer approach compared to the SEC.
Chris Giancarlo, a former CFTC chair, has endorsed the idea, highlighting the agency’s capacity to regulate digital commodities effectively, provided it receives sufficient funding and leadership. Under Giancarlo’s tenure, the CFTC declared Bitcoin a commodity in 2015 and later approved Bitcoin futures in 2017. Current CFTC Chair Rostin Behnam has also emphasized the need for additional resources to oversee crypto markets, noting the agency’s limited budget and smaller workforce compared to the SEC.
The CFTC’s enforcement activity has already involved several high-profile cases against crypto companies, despite its lack of a formal mandate to regulate the sector. However, the agency’s significantly smaller operating budget and staff could present challenges in taking on expanded responsibilities.
Meanwhile, the SEC is bracing for leadership changes, with Chair Gary Gensler and Commissioner Jaime Lizárraga both set to step down before Trump’s inauguration. These shifts in personnel and the potential reallocation of crypto oversight reflect an evolving regulatory landscape, with the incoming administration signaling a desire to recalibrate how the US approaches digital assets.
