US President Donald Trump’s nominee to lead the Commodity Futures Trading Commission, Mike Selig, told senators at his confirmation hearing on Wednesday that he will defend the president’s intention to establish a US path for cryptocurrency regulation.
The Senate Agriculture Committee, which oversees the CFTC, which will be a major US cryptocurrency regulator, weighed Selig’s nomination, with Chairman John Boozman asking about oversight of digital assets in his first question.
“The CFTC has a critical mission to protect these markets,” Selig said. He told lawmakers: “This is a real opportunity to develop a framework that allows software developers to thrive, new exchanges to emerge that will protect investors and have the types of controls that would be expected on an exchange and ensure that we have the right disclosure requirements that we normally have in our financial markets.”
The agency has been led by acting president Caroline Pham since the beginning of the year, when Trump appointed her to the temporary position. She has set an aggressive agenda for cryptocurrencies, speaking as recently as this week about the number of digital asset initiatives at the agency. But Pham has been planning his departure for months, hoping for a permanent replacement, but his departure was stymied when Trump’s previous pick, former commissioner Brian Quintenz, was withdrawn.
Selig could take over the CFTC soon, as the committee has already set consideration of his confirmation for Thursday afternoon, which could send him to the Senate floor for a final vote. If confirmed, he will become the sole member of what should be a five-member bipartisan commission. That will come with efficiency, as he will be the only commissioner who will need to approve measures on crypto policy, but some agency observers wonder if the missing commissioners will make the agency’s actions vulnerable to a legal challenge.
For the moment, Selig has been a senior official working on the Securities and Exchange Commission’s Crypto Task Force, so he is well versed in the industry’s current policy needs. At the hearing, he was asked about decentralized finance (DeFi), a controversial topic in ongoing negotiations in Congress over a bill on the structure of the US crypto market.
“Blockchain enables such a wide range of new types of products, services and applications, that in many cases it may not make sense to apply financial regulation to, for example, a video game application running on a blockchain,” Selig said. “So I think when we think about DeFi, it’s a buzzword, but we should actually look at marketplaces and on-chain applications, and think about the characteristics of these applications, as well as where there is an actual intermediary involved.”
As the lawmakers mentioned during the hearing, the agency has reduced its staff by up to 20% recently as the Trump administration has reduced the federal workforce and is taking on new tasks, including oversight of crypto activity. But Selig did not commit to increasing staffing levels at the agency, saying he would have to take a look once he arrives. People familiar with the CFTC’s internal planning have said the agency is focusing on the law enforcement division, trying to ramp up that staff again and establishing a specialized trial unit by hiring experienced government prosecutors.
When asked about bitcoin mining, Selig called it “critically important infrastructure.”
“We should build them in America,” Selig said. “We must ensure we protect our miners and our infrastructure.”
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