CFTC Chair Warns Markets Must Adapt to Mass Tokenization

CFTC Chair Michael Selig has called for market preparation for mass tokenization by adapting to new technologies such as blockchain and artificial intelligence.

At a conference at the Federal Reserve Bank of New York, Selig highlighted the need for regulators to prepare markets for 'mass tokenization' by adopting these new technologies. He emphasized that RWA (Return on Assets) can enable near-instantaneous settlements and real-time collateral movement between clearinghouses, intermediaries, and end-market participants.

Selig noted that the next decade will likely bring more changes to financial markets than several previous ones combined due to the development of tokenization, on-chain finance, and 24/7 trading. He also expressed opposition to a one-size-fits-all approach to 24/7 trading, suggesting that certain assets such as agricultural commodities and energy products require further assessment.