The Commodity Futures Trading Commission (CFTC) has pledged to double down on educating retail digital assets investors to protect the faction of the market, which is made up of a significant population of minorities that are underserved by the financial system.
According to remarks made by CFTC commissioner Kristen Johnston, racial and ethnic minorities, senior citizens, serving military personnel, and veterans are increasingly flocking to the digital assets market. These groups are attracted by promises of financial inclusion and opportunities to increase their wealth.
The commissioner highlighted that these pledges often fail to materialize as the digital assets market has often suffered notable periods of decline. These periods have had impacts on diverse communities, which is why the CFTC has taken the initiative to explore the benefits of well-tailored and carefully crafted regulations.
She added that regulations would be followed with high enforcement standards and educational outreach to protect retail participants.
“As retail market participation becomes more prevalent in digital asset markets as compared to other commodity futures markets, it is imperative to protect retail market participants with sound regulation, enforcement, and educational outreach,” Johnston said.
The commissioner made the remarks while speaking at a roundtable organized by her office, in collaboration with the CFTC Office of Minority and Women Inclusion (OMWI) and the CFTC’s inaugural chief diversity officer, Tanisha Cole Edmonds, to discuss digital assets and financial inclusion.
CFTC anticipating more digital assets oversight powers
During the roundtable, the commission also commented on incoming digital assets regulations that would increase its digital assets oversight powers under the Digital Commodities Consumer Protection Act of 2022 (DCCPA) proposed this month.
The Responsible Financial Innovation Act, meanwhile, was noted as a comprehensive reform measure expanding the CFTC digital assets jurisdiction. While officials continue to deliberate on the bills, the CFTC reiterated that it would continue to explore all avenues to exercise its existing powers. This echoed the commission’s recent statement when it announced the restructuring of LabCFTC to become the Office of Technology Innovation (OTI) with a mandate of educating consumers about digital assets scams.
In another consumer education push, the CFTC issued a consumer warning against 34 unregistered digital assets and forex trading firms. It cautioned consumers not to interact with the entities added to its Registration Deficient List (RED List). The list now contains 202 firms in total.
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