In a speech at Duke University on Wednesday, Commodity Futures Trading Commission Commissioner (CFTC) Kristin Johnson formally called on Congress to modify several pieces of proposed digital asset legislation to expand the agency’s authority to conduct due diligence on any firm – foreign or domestic – seeking to purchase a minimum 10% share of the equity interest in a CFTC-registered market participant.
“Specifically drawing from the example of LedgerX, I am advocating for regulation that formalizes the obligation to separate customer property, ensure financial resource requirements…and introduce effective governance and risk management controls,” Johnson said.
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Johnson’s remarks echoed CFTC officials’ brewing frustration in recent months over the agency’s limitations and calls for more authority.
In December, Rostin Behnam, CFTC Chairman , told lawmakers in December that his agency did not have enough authority to properly oversee FTX, which was based in the Bahamas. Instead, the CFTC only had insight into LedgerX – one of the few FTX-owned companies that has remained solvent throughout the collapse and subsequent bankruptcy process.
Behnam and Johnson have used the example of FTX to demand expanded authority for their agency to oversee the crypto industry – something they’ve repeatedly argued could prevent the next FTX from happening.