Behnam Flags Crypto Spot Market Oversight Limitations After CLARITY Act Fails
Former CFTC Chair Rostin Behnam acknowledged the limitations of his agency's existing authority in overseeing the crypto spot market following the failure of the CLARITY Act to advance through the Senate.
The bill, which focused on crypto market structure, needed 60 votes but only secured 49 in favor and 50 against in a September 15 Senate procedural vote.
Behnam likened regulating the crypto spot market with the CFTC's current powers to 'putting something together with Scotch tape and paper clips,' indicating that existing law is insufficient for consistent application.
He also emphasized the need for regulators to establish ways to protect customer assets when crypto companies go bankrupt, a key challenge in this area.
In another development, Behnam called for clearer regulatory standards in the fast-growing prediction market sector. He urged Congress to define the boundary between risk-management products and gambling, which has led to conflicts between federal oversight and state gambling rules.