WEBVTT - CFTC Commissioner Summer Mersinger Talks Crypto Policy, Perpetual Futures

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news. So joining us to

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<v Speaker 1>discuss a state of crypto, especially under the Trump administration

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<v Speaker 1>is CFTC Commissioner Summer Mercinger. She is leaving the CFTC

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<v Speaker 1>at the end of the month and will become the

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<v Speaker 1>next CEO of the Blockchain Association. I also want to

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<v Speaker 1>bring in Bloomberg Crypto co host Tim Stenewick for this conversation. Summer,

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<v Speaker 1>let me ask you, just right off the bat, what

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<v Speaker 1>are your hopes for the stable coin bill? What does

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<v Speaker 1>it signify for the industry if and when it does

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<v Speaker 1>pass the entire Senate.

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<v Speaker 2>It signifies that this asset class is clearly here to stay,

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<v Speaker 2>that it's been embraced in the United States, and we

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<v Speaker 2>really are going to make the United States the forefront

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<v Speaker 2>of economic power that we could see from these tokens

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<v Speaker 2>and this asset class.

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<v Speaker 3>Summer serious, why specifically you are leaving the CFTC. I mean,

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<v Speaker 3>your term wasn't set to be over until twenty twenty eight.

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<v Speaker 3>You could have stayed for that long, and you said

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<v Speaker 3>it was in your statement last week that it was

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<v Speaker 3>heartbreaking to actually decide to leave the CFTC. So why leave?

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<v Speaker 2>That's a great question, and I did really struggle with

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<v Speaker 2>this decision. One thing I had to think about is

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<v Speaker 2>we have a very strong incoming chairman who has a

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<v Speaker 2>great voice for the crypto industry and will be a

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<v Speaker 2>real advocate for the industry and the agency at large.

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<v Speaker 2>I really do feel like I also have a good

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<v Speaker 2>voice that I can bring to this debate, that I

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<v Speaker 2>can bring to this industry and help us get across

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<v Speaker 2>the finish line and a number of priorities, one being

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<v Speaker 2>courts the stable prints legislation, but also the market Structure bill.

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<v Speaker 2>And really I think the best place for me to

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<v Speaker 2>contribute to that is through this opportunity that I have

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<v Speaker 2>coming up with a blockchain Association. So while it was

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<v Speaker 2>very hard to make the decision and to leave my

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<v Speaker 2>post before I was done with my term, I really

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<v Speaker 2>do think as far as being able to contribute to

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<v Speaker 2>the process, I will have this great opportunity to do

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<v Speaker 2>so from the association.

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<v Speaker 3>Do you think you would have stayed if you were

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<v Speaker 3>picked by the President to be the acting Commissioner? Your

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<v Speaker 3>name was certainly one on the list, Yes.

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<v Speaker 2>And certainly that would have played into it. I think

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<v Speaker 2>timing wise, that would have played part of the role

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<v Speaker 2>as well. But you know, I think the President and

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<v Speaker 2>his team did a great job of picking very strong

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<v Speaker 2>leaders for this agency and for the other financial regulators

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<v Speaker 2>as well, and I fully support the decisions that they made,

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<v Speaker 2>and I am hoping that I can continue to work

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<v Speaker 2>closely with the current acting chair and the incoming chair

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<v Speaker 2>and my new role.

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<v Speaker 1>So, bigger picture, what rolled you envision for the CFTC

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<v Speaker 1>as a crypto reregulator now that you are moving on

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<v Speaker 1>to the industry to lead the Blockchain Association.

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<v Speaker 2>CFTC is uniquely positioned to be the right regulator for

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<v Speaker 2>the crypto spot market. We already have a lot of

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<v Speaker 2>regulatory oversight of trading that happens in the futures markets

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<v Speaker 2>on some of these assets. We are market regulators, so

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<v Speaker 2>we are uniquely qualified to really watch over the market

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<v Speaker 2>to make sure it's functioning, that it's liquid, that it's vibrant.

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<v Speaker 2>And we have an existing enforcement authority over a lot

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<v Speaker 2>of these areas already, so we are uniquely qualified. We're

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<v Speaker 2>also a global regulator. All of our markets are global.

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<v Speaker 2>These markets are global as well, and so that it

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<v Speaker 2>kind of puts us in this position of being ready

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<v Speaker 2>for that level of jurisdiction.

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<v Speaker 3>I think a lot of people who are watching the

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<v Speaker 3>industry closely are curious about sort of what's in the

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<v Speaker 3>pipeline on a regulatory front, and perhaps whether or not

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<v Speaker 3>you actually expect perpetual crypto futures to be approved in

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<v Speaker 3>the US in the near future. Is that something you

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<v Speaker 3>think could happen.

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<v Speaker 2>Yeah. Absolutely. In fact, I think those can come to

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<v Speaker 2>market now, and we're seeing some applications, and I believe

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<v Speaker 2>we'll have some of those products trading live very soon.

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<v Speaker 2>It will be great to get that trading back on

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<v Speaker 2>shore in the United States. I think it's unfortunate that

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<v Speaker 2>it has been driven off short for so long, and

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<v Speaker 2>the fact that we can have that here in the

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<v Speaker 2>US and under our regulatory framework is a really good

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<v Speaker 2>thing for these markets and will be really beneficial to

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<v Speaker 2>the industry broadly and to our economy here in the

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<v Speaker 2>United States.

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<v Speaker 3>I think a lot of people are curious, as an

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<v Speaker 3>outgoing regulator about political involvement at the CFTC and to

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<v Speaker 3>what extent this organization is actually free from political influence.

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<v Speaker 3>What would you say to somebody asking that.

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<v Speaker 2>We've been historically bipartisan. You know, part of that comes

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<v Speaker 2>from the fact that our over our oversight committee at

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<v Speaker 2>the House and Senate, or the House and Senet agriculture

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<v Speaker 2>committees which tend to be or bipartisan than other committees,

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<v Speaker 2>and the Congress, and you know, as just a case

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<v Speaker 2>in point, I think probably some of my biggest compromise

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<v Speaker 2>where I worked closely with probably with the most progressive

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<v Speaker 2>member of our commission commission, Goldsmith Romero. We work together

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<v Speaker 2>on a number of issues. We voted together quite a bit,

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<v Speaker 2>and it was kind of proof that we do work

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<v Speaker 2>in a bipartisan manner where you know, even though we

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<v Speaker 2>are from different parties, we come together to do what's

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<v Speaker 2>fast for the markets.

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<v Speaker 1>Nevertheless, come June, the CFTC will just have two of

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<v Speaker 1>five commissioners and that looks to a lot of people

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<v Speaker 1>like a leadership gap. But we also see a lot

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<v Speaker 1>of the independent agencies of which the CFTC is one

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<v Speaker 1>kind of being stripped of resources of people as Doge

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<v Speaker 1>and the White House overall try to fin the ranks

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<v Speaker 1>of federal employees. What kind of balance of power is

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<v Speaker 1>there in Washington if everything seems to run through the

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<v Speaker 1>White House. I guess it's another way of asking, could

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<v Speaker 1>we see a market disruption, a market event, you know,

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<v Speaker 1>undesirable events taking place in future's options. If there's less

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<v Speaker 1>folks at the CFTC, yeah, I don't have that concern.

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<v Speaker 2>We have a very strong staff. Our agency has always

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<v Speaker 2>done an amazing job of staying up on the markets

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<v Speaker 2>and ensuring that they are free from manipulation and anything

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<v Speaker 2>that would be a kind of non economical impact on

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<v Speaker 2>market movement. And we've done that through many volatile times

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<v Speaker 2>with you know, sometimes two commissioners, sometimes a full slate

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<v Speaker 2>of commissioners, but the agency is very flexible and is

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<v Speaker 2>able to adapt quickly and just overall on the kind

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<v Speaker 2>of power structure, I think, you know, the Trump administration

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<v Speaker 2>has their their way of viewing this administration, and you know,

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<v Speaker 2>I fully respect that, and I do think that the

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<v Speaker 2>independent agency will continue to do what it was put

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<v Speaker 2>place to do and oversee the derivative markets and make

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<v Speaker 2>sure that they continue to offer the utility that they

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<v Speaker 2>are supposed to offer, which is price discovery and hedging.

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<v Speaker 3>Commissioner Mercinger. We've got a story out now speaking of

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<v Speaker 3>the Trump administration that says that since the early days

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<v Speaker 3>of the reelection campaign, the president has essentially doubled his

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<v Speaker 3>net worth more than doubled it to five point four

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<v Speaker 3>billion dollars, more than five hundred million of doubt that,

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<v Speaker 3>according to our reporting, comes from sales of just one

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<v Speaker 3>of his crypto ventures, not to mention the Meme coins,

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<v Speaker 3>the Trump digital trading cards. There are critics out there

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<v Speaker 3>who say that he's too close and too involved with

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<v Speaker 3>the crypto industry. They're worried about pay to play. What

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<v Speaker 3>do you say.

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<v Speaker 2>I worry that this distracts from the arguments that we

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<v Speaker 2>need to be focused on right now. It's time for

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<v Speaker 2>the US to unlock this the economic power of the

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<v Speaker 2>crypto markets in the United States. It's time to bring

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<v Speaker 2>this trading activity on shore. In order to do that,

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<v Speaker 2>we do need things like the stable point Life legislation

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<v Speaker 2>that's moving through the Senate. We do need to have

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<v Speaker 2>a market structure bill, and that needs to be our

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<v Speaker 2>focus right now. So I think some of this just

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<v Speaker 2>becomes a distraction from what is really the most important,

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<v Speaker 2>you know, important thing here, which is providing a regulatory

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<v Speaker 2>framework so that we can have these markets on shore

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<v Speaker 2>and in a space where US retail customers can access

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<v Speaker 2>these markets in a safe space with the proper regulatory oversight.

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<v Speaker 3>Just to clarifyer, are you saying that the president's involvement

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<v Speaker 3>in the industry is a distraction or the critics are

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<v Speaker 3>a distraction.

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<v Speaker 2>I'm saying the critics are using it as a distraction

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<v Speaker 2>away from what you really needs to get done, and

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<v Speaker 2>I think that's unfortunate.

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<v Speaker 1>So is a meme coin dinner that the president is

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<v Speaker 1>hosting later on tonight a distraction? Excuse me attending, you.

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<v Speaker 2>Know, I haven't paid too much attention to this headline,

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<v Speaker 2>so I don't really know. I don't have a lot

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<v Speaker 2>to comment on it. I think for me as as

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<v Speaker 2>a regulator in my current role, you know, I'm more

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<v Speaker 2>focused on where the broader industry is and what you

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<v Speaker 2>know they're focused on. They're on the hill, they're working

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<v Speaker 2>on the stable claim legislation, they're meeting with staff, they're

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<v Speaker 2>working on the framework for the market structure bill, and that,

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<v Speaker 2>to me is really where my focus and energy has

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<v Speaker 2>been throughout this debate.

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<v Speaker 1>Summermersing are the outgoing commissioner of the CFTC. Thank you

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<v Speaker 1>so much, And of course, Bloomberg's Tim stun A, a co

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<v Speaker 1>host of Bloomberg Crypto, really appreciate it,