The Commodity Futures Trading Commission in the US has warned the crypto industry that more enforcement actions could be on the way. Chairman Rostin Behnam has said that the combination of the bull run and an uncertain regulatory environment could create a perfect storm for more enforcement actions.
The statement comes at a time when the crypto market is expecting a reversal trend in the recent downhill movements. BTC consolidates above $64,000, and Ether effectively tests resistance at $3,100. Other cryptos will likely follow the trend, especially altcoins like meme tokens and AI tokens. The CFTC Chairman has said that the next cycle of enforcement actions could come in 6 to 18 months or 6 to 24 months.
That is based on the renewed interest on the part of entrepreneurs. Also, there is a surge in the market cap, market size, and investments. These are acting as catalysts for the Commission to step in. The assumption is that there will be heavy lawsuits in the absence of actions from Congress and increased regulatory transparency.
Nevertheless, lawmakers have momentum and a desire to bridge the regulatory gaps. However, getting legislation done these days is difficult since the actual working days from now to elections are limited.
It will be rather crucial for relevant agencies to take a call at the earliest. Two platforms have been served a Wells Notice from the US SEC – Robinhood and Consensys.
Robinhood has expressed disappointment with this move by saying that they have only acted in good faith attempts to work with the US SEC to bring regulatory clarity. The expression came from the Chief Legal & Compliance Officer of Robinhood, Dan Gallagher. Consensys revealed that their Wells Notice was in addition to multiple subpoenas about Ethereum. Behnam has yet to comment on their relationship with the SEC.
This has had little effect on the crypto market as of now. The market is in a correction phase, with many speculating that the next 2 months are crucial for price movements. BTC could sustain consolidation before making a breakthrough at $85,000 and $100,000 by the end of 2024. Ether’s rise to $3,100 has set the tone that the community may be lowering its dependency on the approval of the ETF.
The market continues speculating on the next ATH for their favorite cryptocurrencies while the CFTC reviews enforcement actions that will likely make their way into the market. There are questions about the kind of relations that the SEC and CFTC share since the market cannot afford a tug-of-war between the two agencies at a time of high volatility. Rep. French Hill, R-Ark, said during an April 2023 hearing that uncertainty is inevitable if two existing agencies contradict each other.
All sights are now on CFTC and the crypto market, with the latter attempting to navigate its way out of the uncertainty and volatility.