Christie Goldsmith Romero, a member of the US Commodity Futures Trading Commission (CFTC), has called for new legislation to prohibit recently licensed cryptocurrency exchanges from certifying products for listing on their platforms.
"I call on Congress to prohibit newly licensed cryptocurrency trading platforms from certifying products for listing themselves. It is important to establish a framework against regulatory arbitration here..Romero says
Speaking at a conference at the University of Pennsylvania focused on the FTX crypto exchange, Romero argued that the current system of self-certification lacked the necessary security and oversight to properly regulate the industry.
The Need for Regulation Against Regulatory Arbitration
According to Romero, the ability for exchanges to independently determine the security of a particular token could lead to harm and put investors at risk. She believes that this is particularly problematic for listing cryptocurrency futures. Romero therefore called on Congress to establish a framework that would prevent regulatory arbitration in the industry, making it necessary for cryptocurrency companies wishing to issue tokens to focus on the regulatory framework set out by the CFTC.
If the crypto industry wants to restore the trust of users, it should seriously strain itself..Romero believes
Greater Responsibility and Comprehensive Verification
In addition to prohibiting self-certification, Romero urged for greater responsibility across the cryptocurrency industry. She suggested that it was necessary for everyone involved in the industry, from lawyers to investors, to work responsibly and adhere to comprehensive verification standards. The focus on huge profits often overshadowed common sense and prevented a thorough understanding of the risks involved.
A Call for Greater Industry Scrutiny
For Romero, restoring user trust in the cryptocurrency industry should be a top priority. While speaking at the conference, she emphasized the need for serious efforts to be made by the industry as a whole. She called for greater industry scrutiny, noting that the FTX and Binance exchanges were part of a larger trend of bankruptcies and liquidity crises among cryptocurrency companies.
Christie Goldsmith Romero's call for new legislation to prohibit cryptocurrency exchanges from self-certifying products for listing on their platforms highlights the need for greater regulatory oversight and responsibility in the industry. By establishing a comprehensive framework for regulation and verification, the cryptocurrency industry can help restore user trust and safeguard investor interests.