Crypto Markets Today: CFTC Chair Proposes Pause to Overhaul Digital Commodities Consumer Protection Bill

Crypto Markets Today: CFTC Chair Proposes Pause to Overhaul Digital Commodities Consumer Protection Bill

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The collapse of crypto exchange FTX might not have happened if the firm was under the Commodity Futures Trading Commission’s watch, the agency’s head argued Thursday.

This article originally appeared in Crypto Markets Today, CoinDesk’s daily newsletter diving into what happened in today’s crypto markets. Subscribe to get it in your inbox every day.

  • CFTC Chair Rostin Behnam, testifying before the Senate Agriculture Committee at the first of several congressional hearings expected on FTX, said his agency couldn’t have prevented the collapse because FTX wasn’t an entity regulated by his agency.

  • Behnam asked the lawmakers for broader authority to directly oversee spot cash market exchanges, which aren’t regulated by any federal agency now (tokens that are deemed securities are overseen by the Securities and Exchange Commission).

  • Most of the senators didn’t seem to make much of a distinction between FTX US, the company operating within the U.S., and FTX.com, the global exchange based in the Bahamas. FTX.com has been facing broader issues, including apparently sending customer and corporate funds to Alameda Research, a trading firm that’s affiliated with FTX.

  • Benham said the DCCPA would have banned the commingling of customer and corporate money and also require better corporate governance and actual bookkeeping. He said this sort of activity would have been prohibited if the Digital Commodities Consumer Protection Act (DCCPA), the bill sponsored by committee heads senators Debbie Stabenow (D-Mich.) and John Boozman (R-Ark.), had been in effect.

  • Benhnam suggested revisiting the bill to ensure it addresses possible misconduct that may occur at other companies.

Other News

In a highly anticipated interview at Wednesday’s DealBook Summit, former FTX CEO Sam Bankman-Fried expressed regret over his exchange’s collapse, but clung to the narrative that its failure was due to a bet gone wrong. During the interview with the New York Times’ Andrew Ross Sorkin, Bankman-Fried didn’t answer many of the questions investors would want answered, nor did he deliver the mea culpa many crypto industry observers have hoped to hear from the 30-year-old former crypto billionaire. “I didn’t ever try to commit fraud,” he said.

“Gas tax:” Coinbase has disabled non-fungible token (NFT) transfers on its iOS wallet app because of a dispute with Apple over the company’s in-app purchase policy. Taking to Twitter on Thursday, Coinbase said Apple is demanding it pay its gas fees using Apple software, which would make those gas fees subject to Apple’s 30% app tax.

U.S. Fed Chair Jerome Powell’s remarks on Wednesday signaled a likely slowing down in interest rate hikes as soon as the central bank’s mid-December meeting, causing mixed results in equity markets. The S&P 500 index and Dow Jones Industrial Average closed down 0.09% and 0.56%, respectively, while the Nasdaq Composite was up 0.13%. Nicholas Colas, co-founder of the market analysis firm DataTrek Research, wrote in a note that as much as Powell is “trying to contain investors’ animal spirits by talking about persistently high interest rates, markets are rejecting that message.” Colas added, “Instead, [markets] are looking through his rhetoric and think they see the inflection point for monetary policy.”

Altcoin Roundup

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  • Polygon: Polygon-based applications can soon run on fully decentralized application programming interface (API) operating on indexing service The Graph, away from the current hosting service. Joining Web3, The Graph Network will allow Polygon developers to find the data they need to improve the efficiency of their decentralized applications (dapps), according to a Thursday post. Polygon’s MATIC token surged earlier in the day and was recently trading up 0.1% in the past 24 hours.

  • Solana: Orca, a Solana-based decentralized exchange (DEX), has integrated with payments heavyweight Stripe to power its fiat-to-crypto transactions. Users will now be able to make fiat purchases for tokens such as USDC and SOL via an on-ramp built inside Orca using Stripe’s fiat-to-crypto system. SOL was trading around $13, down 1.6% in the past 24 hours.

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