CFTC Chair Rostin Behnam To Resign On the Same Day as Gensler

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As a researcher looking into recent developments in the financial sector, I’ve come across an interesting piece of news: Rostin Behnam, Chair of the Commodity Futures Trading Commission (CFTC), has announced his resignation effective on Inauguration Day. While Behnam took some contentious steps towards the Web3 and crypto industry, it’s worth noting that his most significant focus was actually in supporting this sector.

The departure of SEC Chair Gary Gensler on the same day opens up a significant chance for pro-cryptocurrency influencers to step into important regulatory roles.

Behnam Will Resign from CFTC

In a statement released by the Commodity Futures Trading Commission (CFTC), Behnam announced his plans to step down from his position, a decision he also shared on social media. As one of the key financial regulators in the United States, Behnam’s departure might open up possibilities for advocating for more favorable cryptocurrency regulations.

After he steps down from this role, he will fully exit the Commission at the beginning of February.

In his role as Chairman, Behnam asserted that he directed the agency with an emphasis on pinpointing, evaluating, and mitigating risks in the markets we oversee. Furthermore, he implemented measures designed to foster agreement, establish boundaries, and ensure fairness among all parties involved. This was done to uphold our mission, maintain stability, and prevent disruptions.

Though Behnam didn’t explicitly reference the cryptocurrency sector in his statements, they appear noticeably friendlier compared to the tone Gary Gensler used during his resignation announcement.

Since 2021, Gary Gensler has served as the Chair of the SEC. On the same day as Benham, he will be stepping down from his position. This departure could potentially open up a significant chance for redefining U.S. cryptocurrency policy.

During Behnam’s term at the CFTC, he hasn’t strictly been against cryptocurrencies. In fact, some of his actions have been beneficial for the industry. For example, in 2023, he advocated for more authority to combat crypto fraud. The following year, he hinted that stricter measures might be needed to curb fraudulent activities.

Furthermore, the crux of his cryptocurrency plans involved pushing for the Commodity Futures Trading Commission (CFTC) to assume the SEC’s primary regulatory position within the crypto industry.

Following years of urging Congress for crypto regulation and confrontations with FTX and similar entities, he has decided to resign. His department invested an excessive amount of energy pursuing crypto crimes, as over 49% of their enforcement actions in the year 2023 were related to cryptocurrency.” – This is how Mario Nawfal expressed it on X (previously known as Twitter).

By July 2024, Behnam asserted that approximately 70-80% of cryptocurrencies fall outside the category of securities. Based on this assessment, he advocated for the Commodity Futures Trading Commission (CFTC) to exercise authority over these digital assets.

Historically, the Commodity Futures Trading Commission (CFTC) has been less stringent compared to the Securities and Exchange Commission (SEC). This view was widely shared within the industry. Following Donald Trump’s election win, he echoed these sentiments, suggesting a readiness to collaborate on this matter, indicating a potential shift towards more lenient regulations.

Nevertheless, it appears that Behnam has decided to step down, rather than continuing with the realization of this vision. A possible hint could be his struggles against Kalshi and similar prediction markets related to elections, which can be challenging to navigate within the U.S. context.

During an interview with Bloomberg, Behnam described this situation as a struggle they weren’t winning and expressed his preference for the CFTC not to function as an “enforcer of election laws.

As a analyst, I’ve noticed that by established custom, only three out of the five Commissioners at the Commodity Futures Trading Commission (CFTC) can belong to the same political party. Currently, Behnam is one of the three Democrats on the commission. This means that President Trump has the freedom to select any qualified candidate from either the Democratic or Republican party to replace Behnam when he steps down or leaves office.

Whoever he chooses, it seems safe to assume it will be an industry ally.

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2025-01-07 22:38