The Digital Commodities Consumer Protection Act (DCCPA) bill has been delayed.
In a congressional hearing on Dec. 1, Senators Debbie Stabenow and John Boozman confirmed that the widely anticipated piece of regulation would be put on hold after a suggestion from CFTC Chairman Rostin Behnam.
Behnam said there was little the CFTC could have done to prevent the collapse of FTX, given the fact that it wasn’t under the purview of the regulator.
However, he opined that the DCCPA bill could have prevented the commingling of customer money and corporate money had it been passed earlier. He proposed revisiting the bill to address similar types of misconduct that could occur in the future. The DCCPA bill would have designated the CFTC as the authority in charge of spot crypto markets.
“Given the circumstances of the past few weeks, I think we should take a pause and look at the bill and make sure there are no gaps or no holes,” said Behnam.
According to him, the bill would be stronger by stipulating adequate disclosures are made around the financial information of the crypto entity.
“We need registration of exchanges. We need surveillance of market activity. We need direct relationships with custodians who are holding customer money so that we can prohibit and prevent money moving around,” he said.
The DCCPA bill was a hotly debated topic among members of the crypto community, with many arguing it used language that threatened the principles of decentralized finance (DeFi). Ironically, former FTX CEO Sam Bankman-Fried was an avid proponent of the bill for which he drew heavy criticism from peers.
FTX is spending money to push a law thru congress that may force defi protocols to operate like centralized exchanges.
the proposal is called the Digital Commodities Consumer Protection Act.
a better name would be the Digital Commodities FTX Protection Act.
— scott???? (@scott_lew_is) October 18, 2022
Responding to a question from Senator Michael Bennet as to why Bankman-Fried lobbied so hard for a bill his exchange could have never complied with, Behnam said he was also surprised.
“I can’t speak to what Mr. Bankman-Fried or anyone at FTX was thinking. They would have been so far out of compliance that it just wouldn’t have been possible,” said Behnam.
The Block reported that Senator Stabenow said she was open to Behnam having more authority over crypto commodities.
“It’s not even close to being in the form that it will be in,” said Stabenow of the bill itself. She said the bill would be revisited next year, with both the CFTC and SEC working together as they have done in the past.