On Wednesday, Rostin Behnam, Biden's nominee to head the Commodity Futures Trading Commission, appeared before the Senate Agriculture Committee in a hearing for his confirmation.
Committee Chair Debbie Stabenow clearly focused her questions on Behnam's plans for the cryptocurrency market.
Behnam pointed to a number of recent enforcement actions that the CFTC had undertaken, including the recent fines against Tether and Bitmex. "We’ve been one of the few cops on the beat because of limited statutory authority,” Benham said, explaining:
“This is the tip of the iceberg. As of yesterday the total size of the digital asset market was $2.7 trillion. Of those $2.7 trillion, nearly 60% were commodities.”
Behnam notably went on to ask for greater statutory authority to become the "primary cop on the beat."
Behnam and Stabenow had a particularly friendly exchange; Behnam formerly served as Stabenow's senior counsel.
Sherrod Brown, who chairs the Senate Banking Committee, joined in today's hearing to reinforce the point, asking: “Are there additional tools that would be helpful for the CFTC on [digital assets]?”
"Absolutely," Behnam responded. “The market transactions that are taking place right now are a huge part of the risk that digital assets pose.”
He further requested “a regulatory structure for both securities and commodities.”
Nobody named specific policies, but the coordination between the two committees is clearly key. The original commodities were primarily agricultural products, which is why the CFTC reports to the Agriculture Committee. The Banking Committee, however, oversees the U.S. securities regulator, the Securities and Exchange Commission (SEC).
The cross-committee interaction on crypto is critical, as lawmakers in the leadership are setting the stage for greater authorities for regulators like the CFTC in digital assets markets, in addition to a standing campaign to secure more funding for those agencies.