Caroline Pham: CFTC Has Sufficient Legal Reach for Crypto Oversight

The Commodity Exchange Act serves as a robust foundation for current oversight, according to Pham, who now serves as chief legal officer at MoonPay. By defining commodities broadly—excluding only onions and movie box office receipts—the legislation grants the CFTC the capacity to address digital assets and derivatives linked to new technological sectors, such as artificial intelligence computing capacity. This interpretation challenges the assumption that specific, market-by-market legislative action is a prerequisite for effective federal regulation.

While current CFTC Chairman Michael Selig acknowledges that full exchange registration likely requires congressional intervention, the agency is pressing forward with Regulation CTX and Regulation CAM. These proposals aim to establish a federal framework for leveraged retail crypto transactions, offering a standardized alternative to the fragmented landscape of state-level licensing. Pham views this approach as a critical step toward enhancing retail trader protections, noting that it builds upon regulatory groundwork established by the Dodd-Frank Act.

Looking toward institutional integration, Pham emphasized the necessity of tokenized bank deposits to handle the liquidity demands of wholesale markets. She estimated that immediate blockchain-based settlement for a full day of trading could require $15 trillion in cash, a burden that traditional net settlement systems currently mitigate. Meanwhile, she anticipates that major American exchanges, including the New York Stock Exchange and Nasdaq, will facilitate meaningful trading of tokenized stocks by 2028, provided these assets preserve essential shareholder rights like voting privileges.