CFTC Chair Outlines 2023-2024 Agency Rulemaking Agenda
CFTC Chair Rostin Behnam outlined the agency's 2023-2024 rulemaking agenda, which focuses on (i) enhancing risk management and investor protections, (ii) facilitating responsible innovation, (iii) the role of climate-related factors on commodity markets and (iv) expanding oversight over crypto markets.
In an address before the ABA Business Law Section Derivatives & Futures Law Committee, Mr. Behnam said that in the coming year, the CFTC looks to vote on at least 30 to 35 proposals, as well as rules and orders proposed last year. He highlighted a proposal to amend derivatives clearing organization governance requirements, as well as considerations for codifying various forms of temporary relief. Mr. Behnam also noted a forthcoming proposal focusing on risk management programs for swap dealers and futures commission merchants. He said that the rulemaking reflects a decade of experience with standard deviation risk management requirements, a wide variety of ongoing questions from regulated entities and significant variation in the way firms handle risk management. Mr. Behnam also flagged the CFTC's plans to take rulemaking actions to address other risks, including (i) cybersecurity, (ii) climate-related risk and (iii) cryptocurrencies.
Mr. Behnam emphasized the continued need to address the regulatory gaps in the crypto industry, and asserted that the CFTC is well-suited to the job. He said that the recent bankruptcies, failures and runs further emphasize the need to establish a framework that would protect consumers and prevent future failures like FTX. He said that the CFTC has significantly expanded its enforcement unit to address fraud and manipulation in crypto markets, reporting that the unit brought 69 digital asset-related enforcement actions to date. Mr. Behnam stated that he expects "another strong year of precedent setting cases," and said that the CFTC will continue to provide assistance to Congress in drafting digital asset legislation.
Commentary
In this speech, Mr. Behnam outlines a fairly ambitious regulatory agenda for 2023, and in contrast to the Fall 2022 regulatory agenda published in the Federal Register (see previous coverage), which outlined much more modest near-term goals.
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