CFTC Approves Unprecedented Vertical Integration for Crypto Firm Amid Warnings of Conflicts of Interest
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The CFTC approved Bitnomial to be the first vertically integrated crypto company, allowing it to act as an exchange, broker, and clearinghouse. This breaks precedent and raises concerns about conflicts of interest.
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The approval comes after years of crypto lobbying, especially by convicted fraudster Sam Bankman-Fried who pursued a similar vertical integration for FTX.
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Experts warn this could set a dangerous precedent, allow crypto firms to get too big, and risk financial crashes if they fail.
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The decision was rushed through by a crypto-friendly CFTC chair, despite over 160 comments warning of risks. One commissioner criticized not waiting for their own vertical integration analysis.
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Consumer advocates say this shows the CFTC is an ill-suited, weak crypto regulator that has now enabled conflicts of interest in the lawless crypto market.