Comment Text:
Dear CFTC Chairman, Commissioners, and Staff:
I highly commend the CFTC's numerous efforts with looking at ways to embrace and adopt blockchain-related innovation to help support the CFTC's mission of protecting market integrity and investors while keeping the US markets competitive, including with its launch of the Technology Advisory Committee.
In addition to coordinating with many other US agencies where there may be overlap with crypto assets beyond commodities and interstate commerce, I suggest that additional feedback and participation from the public be sought from local US (and perhaps international) trade associations that have already brought together stakeholders to discuss and address emerging challenges when it comes to blockchain and cryptographic assets (and their many potential concurrent classifications including as potential securities, commodities, utilities, applications, and other forms of tokenized cryptographic assets and depending on their stage of evolution).
By providing more time for additional feedback and public participation, perhaps in a subsequent call for comments, we can help ensure that all important concerns are highlighted, and from a wide range of participants.
While many await guidance and rule-making from the CFTC and SEC, perhaps the recognition of a designated SRO that consists of many various trade associations coming together under one umbrella could help create a focal point for common and emerging issues to be resolved and proposed, related to both private centralized blockchains and public decentralized ones.
I am sure the CFTC will have a very important role in the future of smart-contracts when it comes to their potential use as futures or options-like products, in terms of speculation and hedging solutions, and many other potential use cases where the CFTC may have jurisdiction. And the potential framework for FCM's to offer OTC crypto trading (comparable to how MSBs offer it now in the US) even in cases where trades are fully collateralized from a margin-account (i.e. no leverage) and not solely for leverage offerings like exchange-traded bitcoin futures.
I think the US has done a fantastic job policing the bad actors and taking action against actual scams and issuing proper warnings and guidance in recent months. I urge the CFTC and other agencies to move fast with regard to supporting innovation but not take a stance that is overly restrictive to innovation and new capital and business formation, especially for small to medium size business - so that they can compete equally with larger incumbents in terms of the cost and feasibility of regulatory compliance.
There are a number of efforts emerging with significant traction in terms of the range and depth of topics that have already been discussed, including The Brooklyn Project, and the Crypto Working Group, Messari, and other non-profit and for-profit efforts that have a self-regulatory focus when it comes to discovering and agreeing on emerging best-practices surrounding crypto assets. Topics include but are not limited to ICO pathways and project types, OTC and off-exchange crypto trading, custody strategies, various blockchain infrastructure protocols, distributed applications, and tokenized payment rails for commercial and retail products and platforms, among other use cases including identity-related and complying with AML/KYC and related rules.
Respectfully,
Steven Hatzakis
