{"id":495287,"date":"2022-09-23T06:17:08","date_gmt":"2022-09-23T03:17:08","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/ctfc-slammed-for-blatant-regulation-by-enforcement-over-ooki-dao-case\/"},"modified":"2022-09-23T06:17:08","modified_gmt":"2022-09-23T03:17:08","slug":"ctfc-slammed-for-blatant-regulation-by-enforcement-over-ooki-dao-case","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/ctfc-slammed-for-blatant-regulation-by-enforcement-over-ooki-dao-case\/","title":{"rendered":"# CTFC slammed for &#8216;blatant regulation by enforcement&#8217; over Ooki DAO case"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a396e4c514a9\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a396e4c514a9\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/ctfc-slammed-for-blatant-regulation-by-enforcement-over-ooki-dao-case\/#%E2%80%9D_CTFC_slammed_for_%E2%80%98blatant_regulation_by_enforcement_over_Ooki_DAO_case_%E2%80%9C\" >&#8221; CTFC slammed for &#8216;blatant regulation by enforcement&#8217; over Ooki DAO case &#8220;<\/a><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9D_CTFC_slammed_for_%E2%80%98blatant_regulation_by_enforcement_over_Ooki_DAO_case_%E2%80%9C\"><\/span>&#8221; CTFC slammed for &#8216;blatant regulation by enforcement&#8217; over Ooki DAO case &#8220;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<p><img decoding=\"async\" src=\"https:\/\/images.cointelegraph.com\/images\/840_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjItMDkvMWZiNDhkNTUtNmRmMi00NGJkLWJmYmEtNDNlNDhhODY2MDQ1LmpwZWc=.jpeg\" \/><\/p>\n<div class=\"post-content\" data-v-6ebd806f>The Commodities Futures Trading Commission (CFTC) has sparked strong criticism from the community after filing a federal civil enforcement action against members of decentralized autonomous organization Ooki DAO over digital asset trading violations. <\/p>\n<p>In a Sept. 22 <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.cftc.gov\/PressRoom\/PressReleases\/8590-22\">release<\/a>, the CFTC stated that it had filed and simultaneously settled charges against the founders of decentralized trading platform bZeroX Tom Bean and Kyle Kistner for their role in \u201cillegally offering leveraged and margined retail commodity transactions in digital assets\u201d<\/p>\n<p>However, the community has kicked up a fuss over a simultaneous civil enforcement action against bZeroX\u2019s associated Ooki DAO and its members, which it alleges it operated the same software protocol as bZeroX after it was passed control of it, and thus \u201cviolating the same laws as the respondents.\u201d<\/p>\n<p>The enforcement action has drawn the ire of a number of crypto lawyers and even a CFTC commissioner with concerns it will set an unfair regulatory precedent.<\/p>\n<p>In a dissenting statement on Sept. 22, CFTC commissioner Summer Mersinger <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.cftc.gov\/PressRoom\/SpeechesTestimony\/mersingerstatement092222\">noted<\/a> that while she supports the CFTC\u2019s charges against the bZeroX founders, the enforcement body is stepping into uncharted legal territory when taking action against DAO members that voted on governance proposals. <\/p>\n<blockquote><p>\u201cI cannot agree with the Commission\u2019s <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>roach of determining liability for DAO token holders based on their participation in governance voting for a number of reasons.\u201d<\/p><\/blockquote>\n<p>\u201cThis approach constitutes blatant \u2018regulation by enforcement&#8217; by setting policy based on new definitions and standards never before articulated by the Commission or its staff, nor put out for public comment,\u201d she said. <\/p>\n<p>Jake Chervinsky, lawyer and head of policy at the U.S. Blockchain Association\u00a0on <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">Twitter<\/a> said the enforcement action &#8220;may be the most egregious example&#8221; of regulation by enforcement in the history of crypto, and drew comparisons between the U.S. Securities and Exchange Commission and the CTFC, noting that: <\/p>\n<blockquote><p>\u201cWe&#8217;ve complained at length about the SEC abusing this tactic, but the CFTC has put them to shame.\u201d<\/p><\/blockquote>\n<blockquote class=\"twitter-tweet\">\n<p lang=\"en\" dir=\"ltr\">It&#8217;s deeply disappointing to see the CFTC damage its own reputation like this among those who care about the future of crypto in the United States, especially at a critical moment while it pitches itself in Congress as the right agency to regulate &#8220;digital commodity trades.&#8221;<\/p>\n<p>\u2014 Jake Chervinsky (@jchervinsky) <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/jchervinsky\/status\/1573088267515355136?ref_src=twsrc%5Etfw\">September 22, 2022<\/a><\/p><\/blockquote>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<p>The DeFi Education Fund also <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/fund_defi\/status\/1573087988959117312\">chimed<\/a> in by noting that the CFTC\u2019s charges also offer a gloomy prospect for people trying to innovate via DAOs. <\/p>\n<p><strong><em>Related: <\/em><\/strong><strong><em>CFTC commissioner visits Ripple offices as decision in SEC case looms<\/em><\/strong><\/p>\n<p>\u201c&#8217;Lawmaking via enforcement\u2019 stifles innovation in the US, and today\u2019s action will sadly further discourage any US person from not only developing but also *merely participating* in DAOs,\u201d it wrote.<\/p>\n<blockquote class=\"twitter-tweet\">\n<p lang=\"en\" dir=\"ltr\">Big picture themes to take away: 1. How much control does a Dao have? if it&#8217;s too much, maybe it&#8217;s the counterparty to the transactions offered by the protocol; maybe decentralization of control over the protocol, not over voting to control of the protocol is what matters. \/11<\/p>\n<p>\u2014 Drew Hinkes (@propelforward) <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/propelforward\/status\/1573088841510043649?ref_src=twsrc%5Etfw\">September 22, 2022<\/a><\/p><\/blockquote>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<p>The list of charges include illegally offering retail leverage and margin trading; \u201cengaging in activities only registered futures commission merchants (FCM) can perform;\u201d and failing to incorporate a customer identification program under the Bank Secrecy Act. <\/p>\n<p>The CTFC also outlined that Bean and Kistner indicated that they wanted to transfer bZeroX over the Ooki DAO as part of a move to avoid crackdowns under the gray area of decentralization.<\/p>\n<p>\u201cBy transferring control to a DAO, bZeroX\u2019s founders touted to bZeroX community members the operations would be enforcement-proof \u2014 allowing the Ooki DAO to violate the CEA and CFTC regulations with impunity,\u201d the CFTC stated. <\/p>\n<p><template data-name=\"subscription_form\" data-type=\"markets_outlook\"><\/template><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/ctfc-slammed-for-blatant-regulation-by-enforcement-over-ooki-dao-case\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8221; CTFC slammed for &#8216;blatant regulation by enforcement&#8217; over Ooki DAO case &#8220; The Commodities Futures Trading Commission (CFTC) has sparked strong criticism from the community after filing a federal civil enforcement action against members of decentralized autonomous organization Ooki DAO over digital asset trading violations. In a Sept. 22 release, the CFTC stated that&#8230;<\/p>\n","protected":false},"author":1,"featured_media":495288,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjItMDkvMWZiNDhkNTUtNmRmMi00NGJkLWJmYmEtNDNlNDhhODY2MDQ1LmpwZWc=.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74894,75422,75186,74898,3123,70934],"class_list":["post-495287","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-blockchain","tag-cftc","tag-dao","tag-sec","tag-leverage","tag-regulation"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/495287","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=495287"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/495287\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/495288"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=495287"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=495287"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=495287"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}