The SEC shocked some crypto investors on Wednesday when it urged cryptocurrency exchanges to register and comply with the nation’s securities laws. Meanwhile, Commodity Futures Trading Commission (CFTC) head Brian Quintenz suggested that the cryptocurrency community should create its own oversight body to regulate the industry.
Quintenz offered his remarks during CNBC’s Closing Bell program, and suggested that regulation would provide the industry with greater credibility in the long run. After noting that the CFTC’s authority is limited to enforcement rather than oversight, he said:
“In advance of Congress making a decision as to who should regulate spot platforms for virtual currencies and how, I would suggest that the community come together and try to form some type of independent oversight regulatory body that has teeth, that can enforce some rules to add credibility to the marketplace.”
While that type of self-regulation wouldn’t preclude action from Congress, Quintenz contended that the creation of an industry oversight and enforcement body would help to protect investors and bolster the industry’s credibility. He added, “I think that’s good business.”
Qunitenz was also asked about the SEC’s expressed concern that many investors mistakenly believe that cryptocurrency trading platforms are regulated. The Commissioner echoed the SEC’s position on that issue as well:
“I think that’s exactly right. I think that everyone that trades these products needs to know that there is no federal oversight over these platforms. And I would agree with the SEC that I think some type of federal oversight is a good idea. Ultimately, it's for Congress to decide that and we’ll have to wait to see what they decide."