Coinbase Pushes 5 Major Crypto Reforms as CFTC Rewrites US Market Rules
Coinbase has made a detailed pitch to the Commodity Futures Trading Commission (CFTC) to update the rules governing the US crypto...
Quick overview
- Coinbase has urged the CFTC to update US crypto market rules to reflect the growing importance of digital assets in mainstream finance.
- The company emphasizes the need for clarity on integrated crypto platforms and conflict-of-interest protections to enhance market efficiency.
- Coinbase advocates for allowing regulated stablecoins as collateral in futures markets to improve liquidity and reduce risks.
- They believe a principles-based regulatory approach from the CFTC is essential for fostering innovation and ensuring the US remains competitive in the global market.
Coinbase has made a detailed pitch to the Commodity Futures Trading Commission (CFTC) to update the rules governing the US crypto market. The company is calling on the CFTC to get its house in order as digital assets become an increasingly important part of mainstream finance. To get this done, they have had to dig deep into their own files to get the feedback they wanted, and it shows in how strongly Coinbase is pushing for this update.
Their Chief Policy Officer, Faryar Shirzad, has been super open about the submissions they’ve made and has made it clear that they’ve taken real care to ensure it’s all built on tried-and-tested market practices that will really help cut down on risks. With adoption happening faster than ever and market structures shifting every day, the company says it’s just not possible to keep sticking to the old rules in a market that operates 24/7 and crosses borders left, right, and centre.
Getting a Grip on Integrated Crypto Platforms
At the heart of Coinbase’s proposal is a push for the CFTC to better understand all-in-one crypto platforms that combine the different ways to trade and store crypto in one place. With the right safeguards in place to prevent conflicts of interest, these platforms could cut costs, get things done much more efficiently, and ultimately keep the market in good nick.
Coinbase is really pushing for
- Clarity around how to oversee these integrated platforms.
- New rules for how DeFi-based derivatives work.
- Conflict-of-interest protections that really make a difference.
- Being able to provide the right structure for rapidly growing DeFi ecosystems.
- Rules that really make sense for innovation, but don’t let risk slide
All of this comes as the CFTC is increasingly interested in the new platforms entering the market – you can see this in the fact that they’ve just given the green light to Polymarket to operate as a fully regulated US exchange.
Giving Stablecoins a Leg Up
Coinbase is also pushing the CFTC to let regulated stablecoins be used as collateral in futures markets – they reckon that dollar-backed tokens will bring a lot more liquidity, speed up settlement times, and reduce the risk of failure that you get when you have counterparties that aren’t rock solid.
The CFTC has already said it’s looking into stablecoins and that it wants to get involved. Coinbase says that if the US gets in on the ground floor, we can actually lead the charge in this rapidly changing global market.
Finding a Better Way to Do Regulation
Throughout their submission, Coinbase has been really keen to say that the CFTC’s principles-based style of regulation is actually just what the crypto market needs – and they’re not the only ones thinking that way. The fact that the CFTC is getting its act together, and that the Acting Commissioner is talking about bringing the SEC and CFTC together to work better, is a real vote of confidence.
At the end of the day, Coinbase is saying that the US needs to get its act together – we need a clear framework that lets the whole sector grow and strengthens the US financial system rather than getting left behind.
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