The United States commodities regulator has gotten a crash course on decentralized finance (DeFi) today, with crypto executives briefing the regulator on key issues affecting the space, including exploits, decentralization and digital identities.
As part of a scheduled first meeting of the CFTC’s Technology Advisory Committee (TAC) in Washington D.C., members from the crypto space gave presentations to the regular with the aim of covering key issues currently impacting DeFi.
CFTC commissioner Christy Goldsmith Romero opened the meeting with prepared remarks, saying “understanding how DeFi works” is “important” as “policy decisions related to DeFi” are currently being made by regulators and lawmakers.
Fantastic day sponsoring the CFTC Technology Advisory Committee. Expert presentations on #DecentralizedFinance #CyberResilience #Cloud and #ArtificialIntelligence. Great thanks to Committee Chair Carol House, Vice Chair @ARedbord and all of the TAC members and presenters. pic.twitter.com/kByy2aDPq4
— Commissioner Christy Goldsmith Romero (@CFTCcgr) March 23, 2023
The panel began with an explainer on DeFi and blockchain technology by Ari Redbord, head of legal and government affairs at blockchain intelligence firm TRM Labs.
He outlined the claimed benefits of blockchains, namely their transparency, immutability and privacy saying it could allow regulators to balance the “right to privacy with the need for security.”
On the subject of decentralization, Redbord along with Nikos Andrikogiannopoulos, founder of analytics firm Metrika, jointly outlined the benefits and issues currently facing decentralization which concluded that the benefits “far outweigh” the challenges which they believe will “self-resolve.”
Excited to join @CFTC TAC meeting sponsored by @CFTCcgr Christy Goldsmith Romero, Chair Carole House and Vice Chair Ari Redbord @trmlabs pic.twitter.com/QCXmpQ4cci
— Kristin N. Johnson (@CFTCjohnson) March 22, 2023
“We’ve reached a point in time where we can no longer ignore decentralization,” Andrikogiannopoulos said. “Not only do we have to embrace it, but I think it’s our duty to lead it in the right direction.”
Redbord highlighted the amount of value that entered DeFi in the last two years, saying it was “stress tested during FTX […] and did not fail. DeFi is absolutely here to stay.”
Currently DeFi’s Total Value Locked (TVL) is around $49.1 billion according to DeFiLlama, rising from around…
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