Thank you, Acting Chairman Behnam and Alicia, for holding, what I anticipate, will be a very informative meeting with robust debate around a number of important issues facing not only the markets regulated by the CFTC, but so many topics of interest to the public more generally.

I think we can all agree that the work done through this Committee has raised the bar in bringing together thought leaders and elevated the profile of the CFTC.  I welcome these discussions because they highlight the importance of the work we do and also present an opportunity to engage in a much-needed conversation about the unique focus of our mission.

In the 1974 Senate Agriculture Committee report accompanying the Commodity Futures Trading Commission Act, the Committee made a keen observation about the role of the newly independent CFTC:

“The proper regulatory function of an agency which regulates futures trading is to assure that the market is free of manipulation and other practices which prevent the market from being a true reflection of supply and demand.”[1]

Even as our markets have grown and Congress has at times expanded our jurisdiction, our role as a regulator has not fundamentally changed.  We are here to ensure that the markets we oversee—the derivatives markets—function properly for the purpose of price discovery and risk management.

I often worry that as the CFTC’s public profile expanded, our role may be increasingly misunderstood—a concern that is demonstrated by press accounts and social media entries suggesting that the CFTC is promoting such things as bitcoin or carbon emission controls.  The public should understand that the CFTC simply monitors developments in these areas because they are important factors in the proper functioning of the derivatives markets.  We do not regulate them, and we certainly aren’t in the business of promoting these things.  Put a different way, the demand for, and development of, the products we regulate is driven largely by the presence of risk—for example, some may utilize bitcoin futures to hedge inflationary risks, and others will seek to hedge risks stemming from broader public concerns, such as climate change, by utilizing the derivatives markets.

The demand for the products we regulate may be derived from private forces or even government mandates, all of which are beyond the CFTC’s remit and control.  The CFTC’s job under the Commodity Exchange Act is to continue our historical oversight to ensure we preserve the function of consequent risk mitigation tools—just as we do today in the regulation of thousands of physical commodity derivatives, several new cryptocurrency derivatives, and almost 150 climate-related derivatives contracts already subject to our regulatory supervision. 

With that said, thank you again for all of the hard work that went into preparing this meeting, and I look forward to today’s discussion and the opportunity to publicly highlight and clarify the scope of the CFTC’s regulatory interest in a vast array of topics.

[1] U.S. Senate Committee of Agriculture and Forestry, Committee report accompanying the Commodity Futures Trading Commission Act (S. Rept. 93-1131), 1974