Today, The Chamber of Digital Commerce sent a Letter to leaders of the House Financial Services and Agriculture Committees responding to a letter from Better Markets published July 11 expressing concerns with draft provisions of the Financial Innovation and Technology (FIT) for the 21st Century Act.
We believe in the importance of a robust and adaptable regulatory framework that reflects the unique characteristics of digital assets. While we respect the perspectives offered in the Letter, The Chamber believes it’s important to use its voice as an industry representative to address certain assumptions, interpretations, and falsehoods related to digital asset regulation that warrant a more nuanced understanding and correction of the record.
CFTC’s Updated Toolkit
Better Markets’ assertion that the ‘CFTC Lacks the Necessary Investor Protection Mandate’ to regulate crypto overlooks the CFTC’s extensive role in ensuring market integrity and consumer protection, underscoring its achievements in safeguarding participants from deceptive trading practices while fostering a transparent and stable market.
The Addition of Innovation to the SEC’s Mission
Better Markets’ concerns about incorporating “innovation” into the SEC’s mandate risk overlooking the evolving landscape of financial markets. Embracing “innovation” doesn’t undermine the SEC’s core duties but rather equips it to effectively assess and regulate emerging technologies, ensuring a proactive, adaptive regulatory approach that balances traditional mandates with the benefits of technological advancements.
Wash Trading Manipulation
Better Markets’ claim about rampant manipulative wash trading in crypto markets selectively ignores that the FIT for the 21st Century Act explicitly prohibits such practices, a point emphasized by Congressman French Hill during the bill’s markup.
Provisional Safe Harbor Concerns
The FIT for the 21st Century Act’s ‘provisional safe harbor’ does not grant malpractice immunity in the crypto space as claimed by Better Markets. Instead, the Act ensures entities remain accountable, with the goal of balancing crypto innovation and robust investor protection.
Magnitude of Consumer Losses
The FIT for the 21st Century Act aims to establish a comprehensive regulatory framework for the crypto industry, enhancing transparency, accountability, and investor protection, countering Better Markets’ claim that only the SEC can effectively safeguard consumers in evolving financial landscapes.
The CFTC’s Unfunded Mandate
Although addressed after Better Markets’ letter was published, the FIT for the 21st Century Act addresses concerns that the CFTC is underfunded by proposing a $120 million allocation, ensuring it effectively regulates the crypto industry without compromising its existing functions.
**Chamber experts are available for comment. Contact firstname.lastname@example.org to schedule an interview.**