CFTC Commissioners Dan Berkovitz and Brian Quintenz discuss the difficulties of regulating crypto derivatives and DeFi. Show highlights:

  • their backgrounds
  • what the CFTC’s duties are regarding crypto
  • how the CFTC’s jurisdiction has evolved over the years
  • why Commissioner Quintenz believes SEC Commissioner Hester Peirce’s safe harbor proposal is “brilliant”
  • what relationship the CFTC and SEC have when making decisions on crypto assets
  • why the commissioners believe CFTC’s complaints regarding BitMEX are “well-founded”
  • why formal regulation for crypto derivatives is unlikely to be produced by the CFTC
  • why leveraged derivatives products are a “concern” to the CFTC
  • what makes regulating DeFi platforms so difficult
  • when it comes to DeFi, who is a natural entity for the CFTC to regulate, if any
  • whether the CFTC would ever go after DeFi “market participants,” who the CFTC also regulates
  • why smart contracts involving futures could be illegal 
  • how the possibility that smart contracts could be illegal squares with the view that software development is a form of free speech 
  • whether the CFTC could prosecute developers who write smart contracts
  • whether the CFTC needs to re-write its laws in light of DeFi innovation
  • why Commissioner Berkovitz thinks the DeFi “winners” will be protocols that focus on meeting regulatory requirements
  • why the CFTC approved Bitcoin futures in 2017 while the SEC has not yet approved a Bitcoin ETF
  • how a Bitcoin ETF could solve Bitcoin’s accounting issue, which currently gives companies no upside for adding BTC to its balance sheet

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Episode Links


Dan Berkovitz, CFTC Commissioner (Sep 2018+)

Brian Quintenz, CFTC Commissioner (Aug 2017+)

Related Links

Bitcoin futures approval from CFTC in 2017: