Christopher Giancarlo, who is the current Chairman of the U.S. Commodity Futures Trading Commission (CFTC) expressed his agency’s growing interest in blockchain technology on Wednesday, during a hearing in the Congress. CFTC wishes to explore the limits of the technology and experiment with it, which is why Giancarlo reiterated the need for appropriate procedures to do that.
The hearing on Wednesday was called “Examining the Upcoming Agenda for the CFTC” and was convened by the House Committee on Agriculture. Giancarlo was posed several questions. One of them came from congressman Austin Scott, who asked Giancarlo to explain the goals of LabCFTC, which is a place dedicated to “engagement with the fintech innovation community”. This lab was set up just last year. Giancarlo answered the question by stating:
“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.”
He also emphasized on the importance of a process that would enable fast information sharing between the agency and fintech innovators, “especially in the area of blockchain.” Which is why the CFTC Research and Development Modernization Act, which was brought about by several members of the Agriculture Committee on June 14, is extremely important since it makes the CFTC agile.
The CFTC is legally barred from establishing any direct contact or take part in any trials related to blokchain proof-of-concepts (PoC). If they do so, the entire process of exchange og information with a private startup would legally constitute a gift, which the CFTC is not permitted as an agency, to dole out.
The CFTC R&D Modernization Act would remove this barrier and allow the agency to take part in trials of new fintech projects, without paying them or breaking the law in any way. These new legal procedures being established are important, Giancarlo explains why:
“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.”