The days when there were only a few recurring regulatory issues in the world of blockchain, cryptocurrency, and decentralized finance (DeFi) may now be behind us. Over the past few years, regulatory attention has seemed to focus primarily on several recurring issues, such as whether a particular token or cryptocurrency is “security” under federal law, with all the requirements. and the legal restrictions such a designation has for issuers, exchanges, buyers and sellers – and the tax consequences of cryptocurrency transactions and payments, given the IRS ‘position that, for purposes tax, cryptocurrency is property rather than currency. While these issues have not gone away, recently regulators from a number of different federal, state and international agencies have come out forcefully to raise a host of new issues that they find implicated by new developments. As innovation and FinTech products take more ambitious and creative forms, it appears that regulators themselves have become more ambitious and creative, not less determined to act.

Derivatives and CTFC

On June 8, 2021, Commissioner Dan M. Berkovitz of the Commodity Futures Trading Commission (CFTC) delivered a keynote address to the FIA ​​and SIFMA-AMG, Asset Management Derivatives Forum 2021, in part to address his “concerns about the rise of decentralized markets. Financial markets. “In his remarks, Commissioner Berkovitz argued that the financial system had” developed over the past two or three hundred years “to” rel[y] largely on financial intermediaries… to reliably provide essential financial services to support financial markets and the investing public. He pointed out that intermediaries fulfilling roles such as providing information to the public, being subject to “fiduciary or legal obligations to act in the best interests of their clients”, providing liquidity and stability in times of stress, safeguarding assets, preventing money-laundering, operating under “set standards of conduct” and having legal responsibility and accountability when standards are not met or “things go wrong”.


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