[Taklimakan Blog] DeFi Projects Are Breaking the Law
The Commodity Futures Trading Commission believes that decentralized finance violates the law “On commodity exchanges and exchange trading”
Decentralized Finance (DeFi) projects may violate the Commodity Exchanges and Trading Act (CEA). This opinion was expressed by Dan Berkowitz, Commissioner of the Commodity Futures Trading Commission (CFTC). An unregulated DeFi market is a bad idea, he said.
“Not only do I think unlicensed DeFi markets are a bad idea, but I also don’t understand how they can exist under CEA,” Berkowitz said.
According to the CFTC Commissioner, the law contains no exceptions for either cryptocurrencies or smart contracts. Berkowitz believes DeFi is undermining the US’s status as a strong financial system due to lack of regulation.