Christopher Giancarlo, chairman of the U.S Commodity Futures Trading Commission, expressed the interest of the agency in embracing blockchain technology at a congressional hearing which took place on the 25th of July, 2018. Giancarlo pointed out the need to set up and implement procedures which would facilitate the CFTC’s efforts to carry out the assessment of benefits of blockchain technology.
Under the theme “examining the upcoming agenda for the CFTC“, the hearing was convened by the House Committee on Agriculture. The discourse started with a question from Austin Scott, a congressman, which sought for a clarification on the goals of LabCFTC, a hub that was set aside to explore the “engagement with the fintech innovation community” in 2017.
The chairman tackled the question by saying, “LabCFTC is our front door into these new regulatory fintech developments in the marketplace, and it’s so important to us to be able to understand these innovations that are coming down the pike so fast.”
The discourse went on to question the value of the CFTC Research and development Modernization act, put in place by the Agricultural committee in mid-June, 2018. The chairman started by pointing out the need for an efficient way of sharing information between fintech innovators and the agency, specifically referring to information on blockchain technology.
Giancarlo explained that the agency is not allowed to be directly involved in trials relating to blockchain proof of concepts. This is because the CFTC is legally forbidden to interact with startups in a way that involves free sharing of information. This leads to a situation where the agency has to pay the private startup to access information which is often followed by a time consuming appropriation process. The chairman continued to bring the R&D Modernization act into the picture by saying that it would help to simplify the process by giving the CFTC the ticket to directly participate in fintech projects without the need to pay, and without violating the law. The chairman went on to bemoan the negative effects of the current setup by saying,
“We’re falling behind. Just two days ago, the Bank of England announced that they’re putting in a new bank-to-bank payment system in the U.K., and it’s gonna be blockchain-compliant. And they’ve had the last four years (…) to participate in all these blockchain beta tests that we’ve not been able to participate in. (…) So I feel like we’re four years behind, because we do need to test it, (…) we need to see how it can help us do a better job as regulator.”
The event served as yet another highlight of the CFTC’s unwavering willingness to take blockchain technology on board. Another notable event took place earlier this year in February when the agency staged a joint hearing with the Securities and Exchange Commission. The event saw Giancarlo expressing the CFCT’s willingness to embrace the technology by asserting that a number of sectors, such as financial institutions, social services, and charities would reap long lasting dividends from blockchain technology.