CTFC Chairman Outlines His Vision for Crypto RegulationsAuthor: Jimmy AkiLast Updated: 16 June 2020 Heath Tarbert, the Chairman of the Commodity Futures Trading Commission (CTFC), has called for a measured approach to cryptocurrency regulation from the government.Earlier this week, the financial regulator published a framework in the Harvard Business Law Review. In it, he explained that the government would be better served if it pursued the topic of crypto regulations from the perspective of broad principles – not specific rules. Principles Over SpecificsThe vast majority of the paper explores how regulators can approach their jobs. As Tarbert explained, a speed limit rule could explicitly say, “Do not drive faster than 55 mph.” In contrast, a principled approach to speed regulation could tell drivers to “Drive carefully under the circumstances.”He explained that principled approaches became associated with light touches in the 2000s. However, that form of regulation functioned as more of a monitoring system. Principle-based strategies encourage simplicity and reduce voluminous regulations.As Tarbert explained, the argument for principles comes with less red tape and an approach that fosters innovation. He highlighted that such an approach would help regulatory bodies, particularly the CTFC, as it would help them stay ahead of the curve and react more proactively to changes in the market and technology.He also pointed out that a principle-based approach would discourage the incidence of loopholes and ensure that companies can comply with the law. He added:“Another area where principles-based regulation is generally appropriate is with respect to developments in financial technology (FinTech), including blockchain and digital assets. […] It is my view that the United States must lead the world in this technology, and applying overly prescriptive rules could stunt the development of this important market.”Much Talk, Little ActionThe topic of regulations has been one that many have spoken on for a while. Financial regulators, industry insiders, and others have made their opinions on the topic known for a while now.Sadly, nothing significant has been done, especially from the CTFC and its sister regulator, the Securities and Exchange Commission (SEC).Tarbert is also not the only one who has called for a softer approach to crypto regulation. Hester M. Pierce, a long-time commissioner at the SEC, famously chided her agency years back for its hard-line approach to industry regulations. At the time, she expressed her fears that excessive regulations would lead to an erosion of innovation in the industry and deter many companies with exciting plans from participating as well.Despite all of this, not much has been done. While the CTFC has continued to remain lukewarm and only step in situations where possible crypto-financial crimes have been committed, the SEC itself is pursuing crypto projects that it suspects of being against its securities laws all the same.The SEC already killed the GRAM token, which was set to be launched by mobile messaging platform Telegram last year. Now, it is turning its focus to the KIN token form social media platform Kik.At the same time, the SEC has continued to hold back any applications for Bitcoin exchange-traded funds (ETFs), costing a lot of companies a chance to corner the market. Evidently, such an approach can’t possibly spur innovation and encourage new players.