Thanks to your leadership, the era of political lawfare, de-banking, and regulation by enforcement is over.

over.Innovators like the people in this room are welcome to the White House, not railroaded to the Big House.

And the new frontier of finance is being built right here in the United States of America.

From day one, this president has been clear.

America will not fall behind and allow other countries to take its place as the greatest country on Earth to build a new technology, operate a business, and invest for the future.

The world will run on the backbone of American technology.

Under President Trump's leadership, we've codified the Genius Act, established a strategic Bitcoin reserve, drawn a clear line in the sand between crypto securities and commodities, launched the first US crypto perpetual, and protected the rights of software developers.

That's true

Does this change the nature of how the CFTC thinks about regulation in this space when, uh, some of these platforms can just, you know, open, so open source their, their guts and show the world exactly how they operate? How does that change your job, if at all?

Well, Bitcoin and blockchain technology really came about on the heels of the financial crisis, and financial crisis, in large part, was this issue of a lack of transparency in our markets because they were super opaque.

We now have a number of forced, uh, reporting and forced transparency initiatives through our regulations as a result of Dodd-Frank and, and regulations thereunder.

But blockchain technology solves a lot of that using technology instead of kind of the, the brute force of, of the regulator.

And so I, I am very excited about that.

I think that blockchain offers a ton of benefits for our traditional markets and for some of these new markets that we're seeing on the frontier, things like prediction markets, things like new crypto asset products and perpetuals.

Um, I expect to, to see this technology be used in a very broad, uh, way across our markets, whether it's in securities or commodity derivatives or the next, uh, new thing in our market.

[laughs] Yeah.

Uh, tell us why that's a position worth fighting for.

Well, Congress was very clear when they drafted the Commodity Exchange Act.

The CFTC is the exclusive regulator when it comes to commodity derivatives, and the definition of commodity is extraordinarily broad.

It covers everything except two things that were expressly carved out, onions and motion picture box office receipts.

So unless, uh, you're looking at onion futures on, uh, one of these exchanges, we regulate it.

And so, um, what I saw coming into office, that the states were bringing these actions against our registered exchanges, really attempting to nullify federal law, and of course, we've got a commerce clause, we have a federal framework for our markets, and that's there for a reason, because these markets cross state lines.

You've got people trading across the country, um, and you need a federal regulator for that.

So I did wanna ask about the, the lawsuits, but, uh, what is the distinction between a sports wager and a sports event contract?

For someone like myself, maybe, or who is a crypto native but doesn't know much about the traditional financial system, let alone regulators, what does the CFTC actually do? How would you explain that to to me.

The Commodity Futures Trading Commission was formed in the 70s, and it was formed to be the core and exclusive regulator of our derivatives markets when it comes to derivatives on commodities.

And commodity is actually very broadly defined in the statute.

So it's not what you'd traditionally think of as commodities.

It does include things like grain, wheat, corn, pork bellies, oil, of course, all the kind of traditional commodities.

But it also includes things like crypto assets.

It includes things like predictions on different events.

And I was wondering if regulators in the US feel any push or they feel the need to stay competitive with other jurisdictions, whether it's Europe or places in Asia?

[laughs]

... that we really have to make sure we get it right.

Um, I, I, I'm concerned that we overregulate and strangle some of the technology here in the United States, and so I'm taking a very much, uh, minimum effective dose of regulation approach, where we're looking at what's happening, um, in terms of the models and, and how they're being deployed and used, and making sure that we're regulating the actors, the persons that are, um, engaging in the regulated activity and not just software developers, right? The software developers are the ones kind of building the tools, but they're not actually engaging in the financial transactions or using it to, to kind of engage in regulated activity.

Um, there was a great court case that dealt with, um, actually Uniswap, the, the decentralized, uh, exchange protocol, talking about how, you know, you don't go after Tesla for the self-driving car that is used to rob a bank, right? You're going after the bank robbers.

And so we're certainly looking to make sure we're regulating the, the traders, the persons that are using them.

For example, if you use a, um, a software tool to help you engage in, in trading activity, the trading activity is still regulated, but you're using a tool just like you're using your, your personal device or your computer, right? So, so we're trying to get that regulation right, and there are a lot of considerations as we're doing it.

But one area that I find fascinating is these kind of autonomous agents that are engaging in their own trading activity, um, potentially for their own kind of benefit.

Talk about what this is and kinda what your goal with it is.

How is, how is that similar versus different to the CLARITY Act, and, and what are you doing as a regulator to help provide some clarity there?

As you all have covered over the years, there's been the, the debate over the Howey Test and its application to crypto.

There's contexts where you sell a digital asset, and you make certain promises and commitments to people that are buying it, and you're, you're selling it for capital-raising purposes, and maybe you've not built out your network yet or your, your product, and you're telling them, "Hey, here's a white paper.

This is what we plan to do." And so they invest in, in that enterprise.

But then they get a digital asset as a result, or maybe down the line that's delivered.

Digital asset itself, it's pretty clear that that's not a type of security unless it gives you certain interest in a, a company or, or certain debt-like characteristics.

But the investment itself, that initial capital-raising transaction, that might be a securities transaction under the Howey analysis.

W-what are you doing and what can you do to protect decentralized finance software developers, those that are pushing code from being labeled as an intermediary? What needs to be done there?

Yep.

Well, look, the, the CFTC and SEC are very different regulators.

So the SEC is a capital markets regulator.

They're focused on somebody wants to go raise capital for a great idea.

Other people wanna place that capital somewhere.

There needs to be some regulation over that.

After the Great Depression, there was a lot of chaos in the markets, and the agency really s- was a great answer to that, uh, issue, and has, has put a great regime in place to regulate all of that.

What's your diagnosis of the actual-... problem there, and I would love to get into the weeds here, and, you know, like, what does coordination look like between the two agencies?