CFTC Chair unleashes innovation panel to tackle crypto and prediction markets

Source: CryptoNewsNet Original Title: CFTC Chair unleashes innovation panel to tackle crypto and prediction markets Original Link: https://cryptonews.net/news/legal/32266181/

Overview

The CFTC has established an innovation panel to address rapidly growing areas, including cryptocurrencies and prediction markets. This move signals the agency’s serious commitment to emerging financial technologies.

The CFTC states that the new panel will enable it to understand better and oversee digital financial systems. Besides traditional markets for things like crops and metals, the CFTC is now increasingly involved in new spaces such as blockchain-based assets and platforms where people bet on future events.

Leadership and Mission

Recently, Michael Selig became the Chair of the CFTC. Shortly after taking charge, Selig announced that the CFTC would rename one of its long-standing internal groups and give it a new mission. The team previously known as the Technology Advisory Committee will now operate as the Innovation Advisory Committee.

According to Selig, the world is undergoing rapid change due to breakthroughs in artificial intelligence (AI), blockchain, cloud computing, and other modern technologies. These technologies are creating entirely new markets and transforming old ones, and the CFTC needs to keep pace so it can maintain fairness, safety, and trust.

To gain a clearer understanding of these technologies and to propose thoughtful rules for integrating financial markets, the CFTC is seeking input from the Innovation Advisory Committee.

Key Figures Drive Innovation

The U.S. Senate confirmed two major appointments to lead financial regulatory agencies. Selig will chair the CFTC, while Travis Hill will head the Federal Deposit Insurance Corporation. The Senate also approved dozens of other nominees in a 53-43 vote.

With Selig at the helm, the CFTC is expected to become a leading regulator of U.S. cryptocurrency activity once Congress finalizes legislation granting the agency expanded authority. He succeeds Acting Chairman Caroline Pham, who had introduced a series of pro-crypto policies during her tenure.

The Innovation Advisory Committee is being established and will be led by the CEO of the Innovation Council. Selig plans to ask members of that council to be the first members of the new committee.

The CEO Innovation Council comprises leaders from major financial and technology companies. It includes individuals such as Tyler Winklevoss, who leads the cryptocurrency firm Gemini; Shayne Coplan, who runs the prediction market platform Polymarket; Tarek Mansour from the prediction market company Kalshi; and Adena Friedman, who heads Nasdaq.

These leaders work with both new digital tools and old financial systems. Their experience can help the CFTC develop effective rules for the future.

The Innovation Advisory Committee will comprise experts from diverse backgrounds — not just large companies, but also university professors, technology researchers, regulators, and groups representing everyday market users.

Selig wants the committee to help the CFTC determine how new technology affects markets and what rules should look like so that people can trade safely. He said the new committee is important because technologies like blockchain and AI are creating numerous changes.

Focus Areas: Cryptocurrencies and Prediction Markets

Two of the big areas people are watching right now are cryptocurrencies and prediction markets.

Cryptocurrencies utilize specialized computer networks known as blockchains. Many people trade cryptocurrencies like Bitcoin and Ethereum, and some companies try to build markets for them. Because these markets are new, some people are unsure how the rules should work — and that is one reason the CFTC is focusing on this area.

Not long ago, the CFTC allowed the first regulated exchange to list something called spot crypto products, which means that people can trade real cryptocurrencies on official U.S. markets.

A prediction market enables individuals to make predictions about future events — such as who will win an election or whether a specific event will occur by a certain date. People can place bets on these outcomes and get money if their guess comes true.