CFTC Seeks Public Comments on Ethereum and Its Underlying Technology

News and Analysis

The U.S. Commodity Futures Trading Commission (CFTC) has put out a Request for Information (RFI) asking for public comment and feedback to help it better understand Ether and the Ethereum blockchain, and the markets that have built up around it.

In a press release published on Tuesday, December 11, the regulator said it is looking for public feedback on a number of questions about Ethereum and how its underlying technology is used.

The RFI will accept responses for 60 days after being published in the Federal Register. Clarifying what the information request seeks to achieve, an excerpt from the announcement reads:

“In a Request for Information (RFI) that will be published in the Federal Register, the CFTC is asking for public feedback on a range of questions related to the underlying technology, opportunities, risks, mechanics, use cases, and markets, related to Ether and the Ethereum Network. […] The RFI also seeks to understand similarities and distinctions between Ether and Bitcoin, as well as Ether-specific opportunities, challenges, and risks.”

The CFTC added that it “expects the comments and information received will benefit LabCFTC, the CFTC’s FinTech initiative, and help to inform the Commission’s understanding of these emerging technologies.”

The RFI further explains that it will inform the agency’s oversight of the Ethereum market, as well as any derivatives markets related to the cryptocurrency.

“The input from this request will advance the CFTC’s mission of ensuring the integrity of the derivatives markets as well as monitoring and reducing systemic risk by enhancing legal certainty in the markets.”

The document lists 25 different questions about Ethereum and its network, divided into the network’s purpose, the technology behind it, its governance, markets and oversight and cybersecurity and custody.

The questions themselves touch on various issues and concerns discussed in the space, including Ethereum’s upcoming move to proof-of-stake, scalability issues, how the network is being used specifically at present and how Ether deposits may be audited, among others.

Up to date, the only cryptocurrency with regulated futures trading is Bitcoin, however, earlier this year, it was reported that Cboe Global Markets was preparing to launch Ethereum futures. People familiar with the matter claimed that the new product would be based on Gemini’s underlying Ethereum market and may launch in Q4 2018.

If it does turn out that the CFTC is exploring approval for Ether futures, this could have a major positive impact on Ethereum which has recently slipped to the third place in market cap rankings, staring behind the second-placed XRP.

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