Heath Tarbet, the chairman of the U. S. Commodity Futures Trading Commission (CFTC), has recently talked about the regulation of the crypto market. According to Tarbet, who has recently assumed the position at the CFTC, the goal is not to snuff out innovation in the crypto world, but to help it grow in an organized way.
The best way to regulate this kind of asset is by observing a lot before jumping to conclusions and adopting targeted rules for the industry. Tarbert emphasized that regulation based on “principles” does not mean that the measures taken will be too light, only that more detailed rules should give space to more flexible ones.
One of the main points that Tarbert talked about was that if you create too many regulations, people will simply lose respect for the law and stop following it. According to the chairman of the CFTC, regulators need to understand this risk and to avoid taking a heavy hand when regulating this nascent industry.
Given how quick the blockchain market is changing, a principles-based approach should be more effective as a way to properly regulate it without damaging innovation too much, Tarbert believes. The previous chairman, Christopher Giancarlo, was also pro-crypto and believed that the industry should have a “do no harm” approach.
The chairman explained, however, that anyone who presents fraudulent behavior or poses risks for financial stability and other people will not be exempt from regulation.
Right now, the CFTC is considering how to take this approach moving forward, especially concerning crypto exchanges and similar businesses.