The president of the Commission of Trade of Futures of Merchandize (CFTC) of the United States, J. Christopher Giancarlo, said that the center of innovation fintech of the agency, LabCFTC, is the internal actor of the regulator in a panorama of exponential technological changes and an evolution of the market.
Giancarlo made these comments during his last appearance as president of the CFTC before the 44th Annual Conference of the International Futures Industry on March 14, in a speech entitled “Improving the Past, Facing the Present and Moving Toward a Future of the Future.” digital market”.
Why his words matter
It is expected that Giancarlo will be replaced this year by the candidate for president of the United States for the presidency of the CFTC, Heath Tarbert, assuming confirmation of the latter.
In his comments, Giancarlo identified “the disintermediation of actors and traditional business models” as a key factor that challenges existing regulatory models, isolating blockchain and cryptocurrencies as two key phenomena that are transforming today’s markets.
A cornerstone of the CFTC’s
To respond to the challenge that this exponential change poses for federal regulators, the president pointed out that a cornerstone of the CFTC’s approach was the establishment of its own internal interest group: LabCFTC.
According to Giancarlo, LabCFTC – which was launched two years ago – has had more than 250 separate interactions with big and small innovators, carrying out laboratory hours in the United States and internationally.
The laboratory is not a regulatory sandbox
The president stressed that the laboratory is not a regulatory sandbox (regulatory environment) and does not exempt companies from the rules of the CFTC, but seeks to provide an “internal and external technological approach.” Also he said:
“Internally, it means explaining technological innovation to agency staff and other regulators and advocating for technology adoption. Externally, that means arriving and learning about technological change and market evolution, while providing a link dedicated to innovators”.
Fintech, was also an important matter
Among his activities, Giancarlo highlighted the laboratory’s fintech cooperation agreements with global regulators – in London, Singapore and Australia – as well as its publication of ‘technology manuals and public comment requests.
Giancarlo remarkably aligned the creation and work of the center as part of a national trend across all agencies, stating that “every federal financial regulator in the US has created or is creating a program similar to LabCFTC”.
The CFTC is adopting market-based innovation solutions
In addition to the laboratory, the president said that the CFTC is adopting market-based innovation solutions, such as its authorization of Bitcoin futures (BTC), and is striving to become a quantitative regulator, one that is “capable of driving”. analysis of market-independent data with different data sources, including block chains and decentralized networks”.
The two fintech educational manuals of LabCFTC have been dedicated to virtual currencies (October 2017) and smart contracts (November 2018). In December, the laboratory requested public and industry comments on the Ethereum (ETH) block chain as part of its evaluation of the possible authorization of Ethereum futures contracts.