Senator Booker: Low Odds for Crypto Bill Without Democrats Appointed at CFTC, SEC
TL;DR
Senator Cory Booker warns that the crypto market structure bill's passage is unlikely without Democratic appointments to the SEC and CFTC, citing concerns over presidential power expansion and potential corruption under Trump.
Key Takeaways
- •Senator Booker emphasizes that Democratic appointments to the SEC and CFTC are crucial for bipartisan support of the crypto market structure bill.
- •The Supreme Court's potential overturning of a 90-year precedent could allow the president to fire agency commissioners at will, threatening regulatory independence.
- •Booker rejects mere promises from the White House on Democratic appointments, insisting on concrete action to ensure balanced and fair regulation.
- •A potential legislative remedy involves inserting language in the bill requiring bipartisan commissioner quorums for the SEC and CFTC to function.
- •The issue of minority commissioners has become a significant obstacle for Senate Democrats in supporting the bill, despite Booker's overall optimism about its passage.
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Sen. Cory Booker (D-NJ), one of the lead Democrat negotiators on the Senate’s closely watched crypto market structure bill, said Tuesday he would not trust any promise from the White House about appointing Democrats to key financial regulators—and said a failure to meaningfully address the issue could derail the bill’s chances of passage.
Booker said he was discouraged that the Supreme Court now appears poised to grant President Donald Trump the ability to fire commissioners from agencies like the SEC and CFTC at will. A crypto market structure bill would hand such regulators huge powers in shaping crypto regulation.
“It is a deep concern,” Booker told Decrypt Tuesday at the Blockchain Association's annual policy summit. “This is a massive expansion of presidential power. We’ve seen what [Trump] has done with this power already, to advantage his friends in a very corrupting way.”
Booker said he is pushing, in bipartisan negotiations over the market structure bill, to make sure regulators like the CFTC and SEC remain “balanced and fair.” Such five-member agencies are legally required to feature two commissioners from a minority party. But President Trump has so far resisted pushes to nominate any Democrats to either the CFTC or SEC. Come January, neither agency will feature any Democrat commissioners.
Booker said he’s "directly made it clear” to the White House that if the president does not appoint Democrats to the SEC and CFTC, that would “undermine our ability” to get the market structure bill over the finish line.
When asked by Decrypt whether a promise from the White House about Democrat commissioners would be enough to earn his vote on the bill, Booker replied: “No. Oh my god, no.”
The senator said it would be “counterproductive” to discuss his ongoing private conversations with Senate Republicans when pressed on what legislative remedies, if any, would make him comfortable enough on the issue to get to a yes on market structure.
Earlier in the day, Booker said during a panel that he is “bullish” the crypto market structure bill will ultimately be passed.
But the issue of minority commissioners has become a growing thorn in the side of Senate Democrats trying to get to yes on the bill. On Monday, the Supreme Court signaled it is likely to soon overturn a 90-year old precedent preventing the president from firing federal agency commissioners, except in extraordinary circumstances. The case has long been considered a guarantor of the independence of federal regulators.
If the case is overturned, then it would mean the president could remove Democrats from the SEC and CFTC at any point in the future—even if he appoints them now to ensure the passage of a market structure bill.
One potential remedy to the issue is language—which could be inserted into the market structure bill—ensuring that the SEC and CFTC could only function if they met a bipartisan commissioner quorum. Senate Democrats have considered such language this fall, sources familiar with the matter told Decrypt.
But it’s unclear whether the Trump administration would ever accept such a check on its ability to do as it pleases. When Mike Selig, the White House’s nominee to lead the CFTC, was pressed on the issue of minority commissioners during his Senate confirmation hearing last month, he reiterated his belief that the agency can function without Democrats.
Should he be confirmed, Selig, a Republican, would be the lone commissioner operating an agency meant to be run by a bipartisan group of five.
“The CFTC is able to function with a single chairman,” Selig said during the hearing.