Wednesday, the US Commodity Futures Trading Commission (CFTC) announced its plan to foster innovation in the financial technology sector. The regulatory agency has developed initiatives which include updating its current rules to be more fintech-friendly and opening an office dedicated to fintech innovation in NYC.
Acting CFTC Chairman J. Christopher Giancarlo announced the launch of LabCFTC, a fintech initiative that will help firms adhere to CFTC regulations. Giancarlo says, “LabCFTC is intended to help us bridge the gap from where we are today to where we need to be: 21st century regulation for today’s digital markets.”
Giancarlo said the LabCFTC initiative encompasses a new program called “GuidePoint” which will get the CFTC more engaged in fintech innovation. To encourage growth in the sector, Guidepoint will have a designated office in Manhattan to mentor leaders and help guide innovators on the CFTC’s rules.
GuidePoint is also intended to help the CFTC identify “analog rules lost in a digital world.” The agency acknowledges its need to become more flexible with its rules and regulations, saying:
“In some cases, we anticipate that innovation may present situations that fall within the spirit, but not the letter, of our rules.”
LabCFTC also consists of a “CFTC 2.0” initiative which has been launched to keep the agency ahead of fintech trends. This part of the plan has been set in motion to ensure the CFTC will be proactively looking for new fintech developments on the hoirzon so it can be prepared.
The CFTC aims to make the shift to real-time market-data analysis and integrate blockchain technology within its own internal functions. Additionally, it seeks to expand its budget, which currently sits at $250 million.
But the US government is also expressing, yet again, its desire to control this rapidly-changing industry. Sharon Bowen, CFTC Commissioner stated, “We need to invest in people and technology to understand and police this ever-changing marketplace.”