The United States Commodity Futures Trading Commission (CFTC) has added 34 crypto entities to its Registration Deficient (RED) List, according to a notice published on July 14.
Some of the affected companies include CryptoSphereFX, Direct Cryptos, Bitpay Options, FX-Cryptex, and others.
According to the notification, CFTC is adding companies that have not registered their transactions involving currencies (Forex) or binary options trading with the authorities.
Part of the message reads:
A company is added to the RED list when the CFTC determines, based on research data and public inquiries, that it is not registered with the Commission and appears to be trading in a capacity requiring registration, such as trading binary options, foreign exchange (forex) , or other products. The Commodity Exchange Act generally requires intermediaries in the derivatives industry to register with the CFTC.
Meanwhile, companies added to the RED list haven’t necessarily broken any law; however, the notice acts as a warning to industry players to exercise caution when dealing with such companies.
More than 200 companies have now been added to the CFTC RED list.
CFTC’s Crypto Regulation Drive
CFTC’s effort to regulate the crypto industry has taken a step forward since Senators Kirsten Gillibrand and Cynthia Lummis introduced a new bipartisan bill placing the industry under its purview.
Rostin Behnam CFTC chairman had said the commission is willing to regulate the sector.
Per Behnam: “Markets are markets, be they derivatives, equities or fixed income… There is always a natural relationship between . . . derivatives in general and money markets.”
Since then, the Commission has lawsuit v Mirror Trading International (MTI) Proprietary Limited on the orchestration of a Bitcoin fraud scheme.
Meanwhile, Security and Exchange Commission (SEC) chairman Gary Gensler is seeking cooperation between both financial regulators to effectively regulate the crypto industry.
According to Gensler, the industry needs “one rulebook” to regulate the activities of industry players.
US Continues Crypto Regulations
Other federal agencies, such as the US Treasury Department, are also ramping up activities to regulate the crypto industry.
Finance Minister Janet Yellen recently Met with Japanese financial authorities to discuss how both countries can work together to regulate the crypto industry.
Since Secretary Yellen took office, she has spoken extensively about the need to regulate stablecoins. The recent collapse of the Terra ecosystem has increased its evangelism for proper regulation of the industry.