CFTC Chairman Supports SEC, Market Participants "Creating Demand" Does Not Mean Bitcoin Spot ETF Compliance

CFTC Chairman Rostin Behnam recently commented on Bitcoin spot ETFs at the winter meeting of the Commodity Futures Trading Commission, criticizing market participants for determining legitimacy by creating demand for products.

CFTC Chairman: Bitcoin Spot ETF Surrounds Conflicts of Interest, Data Opacity

During a speech, Rostin Behnam mentioned his views on a Bitcoin spot ETF, noting that the "listing of a Bitcoin spot ETF" is seen by many as the next natural step in the digital asset market, and regardless of how this value is determined, it will inevitably find a way to integrate with established regulatory frameworks.

He stated:

While Bitcoin ETFs are being marketed to the public as a means of legal certainty, there are still no measures in place to address conflicts of interest, data opacity, and inconsistent practices in the digital asset cash market. Instead, exchange-traded products (ETPs) are using speculative, volatile assets, wrapping them in an indirect regulatory layer, and packaging them as shiny new products.

Legislation Does Not Imply Legitimacy

"As the SEC decision on January 10th demonstrated, legislation is not a prerequisite for legitimacy," Rostin Behnam stated.

He seemed to suggest that the SEC was forced to approve a Bitcoin spot ETF due to the Grayscale lawsuit failure.

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He used the movie "GT: Cross Player" released last year as an example:

The protagonist goes from a racing video game to real-life racing competition, obtaining an FIA racing license. Technically, he is eligible to compete, but he is still warned to prove himself in the racing world because he did not enter through normal, traditional channels. Nobody welcomes him; the drivers don't, the pit crew doesn't, the mechanics resent him because despite having a license, he is fundamentally unsafe, and the license does not change the nature of the risk.

Market Participants "Create Demand," Shaping Legitimacy

Rostin Behnam pointed out that Congress has not granted any federal regulatory agency the authority to oversee the digital asset cash market, and market participants first determine legitimacy by creating demand for products.

He emphasized at the end of the document that he will actively promote federal-level legislation:

We do not have the authority to confirm the legitimacy in the eyes of market participants, but ensuring legitimacy should not cater to market sentiment but should be built on a more solid foundation. I am concerned that the approval of Bitcoin ETFs will bring risks, and my concerns about making public statements regarding the digital asset market in the next six years will only grow. The urgency of federal legislation on digital assets has never been more pressing, and I will continue to urge action.