The nomination of US President Joe Biden to lead the Commodities Futures Trading Commission (CFTC) on Wednesday indicated that climate risk and the rapid adoption of digital currencies will be priority objectives if he is confirmed.
For Biden’s Candidate, Climate Is A Top Priority To Lead The Commodities Futures Trading Commission
Rostin Behnam, a Democratic commissioner at the CFTC since 2017 and its interim chairman, set out his vision for the agency before the Senate Agriculture Committee, a key first step in reviving an agency that has been dormant for months without a permanent leader.
Behnam praised the CFTC’s continuous work to supervise derivatives, stating that the sector of the financial markets “performed quite well” amid the chaotic start of the COVID-19 epidemic in early 2020.
He also stated that if granted the top post, he would implement an active enforcement effort at the agency.
I will prioritize policy that invigorates a culture of compliance, reinforced by an enforcement program that roots out fraud,” he stated in his opening statement.
Behnam also stated that he would support any legislation considered by Congress to give the CFTC more control over digital currencies, claiming that the quickly developing industry might benefit from better oversight.
“Given the size, the scope, and the scale of this emerging market … I think it’s critically important to have a primary cop on the beat,” he said.
Behnam has made climate change a central focus of his work at the CFTC. He established a climate risk unit in March with the goal of better understanding and pricing climate-related risks in derivatives markets.
He also supported a 2020 study from the CFTC’s industry advisors that identified climate change as a serious threat to the financial sector.
Behnam’s Appointment Comes At A Time When The CFTC Is Understaffed
On Wednesday, Behnam stated that it was critical to monitor climate risk in financial markets. Climate change, he says, does not presently pose a risk to the financial system, but it may in the future if extreme weather events become more frequent and severe.
He did, however, add that derivatives might play a “key role” in any market-based policy to solve the problem.
Democratic Commissioner Daniel Berkovitz stepped down in October, leaving the agency with only two active commissioners – Behnam and Republican Commissioner Dawn Stump.
Biden has also nominated law professor Kristin Johnson to serve as a Democratic member, although she has yet to be approved.
- Climate change
- digital currencies
- Financial sector
- Joe Biden