Crypto Tokens Shouldn’t be “Self-Certify” by Exchanges

• CFTC commissioner Christy Goldsmith Romero warned about crypto self-certification.
• Goldsmith urges Congress to stop allowing exchanges to self-certify products.

The cryptocurrency exchange FTX collapse called the commissioner of the Commodity Futures Trading Commission (CFTC) to stop allowing crypto exchanges to “self-certify” and list tokens in an unregulated way.

CFTC commissioner Christy Goldsmith Romero stated that;

I urge Congress to avoid permitting newly-regulated crypto exchanges to self-certify products for listing, under the current process that limits CFTC oversight.

CFTC to Monitor Crypto Exchanges

The dramatic collapse of the crypto exchange FTX in November has placed additional pressure on U.S. regulators and lawmakers to tighten industry monitoring. Also, FTX’s demise indicates the need for heightened scrutiny from the CFTC while the U.S. platforms are allowed to list crypto assets. 

On January 18, CFTC commissioner Christy Goldsmith Romero urged Congress at a University of Pennsylvania discussion on FTX. That exchanges need to assure sufficient oversights and the current standard procedure was insufficient to provide competent oversight of cryptocurrency. Further, the U.S. federal government commissioner stated that the asset class doesn’t fit itself into the fast-track method. Exchanges commonly utilize to list tokens due to the risks connected with digital assets. 

Moreover, Goldsmith claims that FTX’s issues weren’t caused for CFTC directly oversaw, but the collapse is a wake-up call. Also, she said that cryptocurrency firms require regulation by the Securities and Exchange Commission (SEC), as per a Reuters report.

However, unless the agency takes action to prevent the plans within 24 hours. Current regulations allow exchanges registered with the regulator to “self-certify” their goods are safe and offer them.