Even the crypto firms are growing at an alarming rate, there are a number of challenges they often face with the expansion of their business endeavors and one of these is getting regulatory approval from the various bodies that are put in place for that purpose. One of the most notable instances is the bitcoin ETF that has been heavily pursued within the industry for a long time but has still not come through. Also notable the amount of effort Facebook is putting into getting regulatory clearance before the launch of the Libra token.
According to September 28, 2019 reports, LedgerX is accusing former United States Commodity Futures Trading Commission (CFTC) chairman Christopher Giancarlo blocking the approval of their amended Derivatives Clearing Organization (DCO) registration because of personal issues with their CEO Paul Chou.
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These allegations were made in the form of two letters from LedgerX and one of the letters dated are July 3, 2019.
“We have strong reason to believe that this unreasonable delay that is in clear violation of the Commodity Exchange Act is related to the Chairman’s animus towards a blog post written by our CEO.”
Chou has confirmed the authenticity of the letters and has claimed it is one of many that were sent to the CTFC and that in January of this year, Giancarlo invited them to a meeting in which he stated that he would make sure the application was not accepted.
“[Giancarlo] told him that he was going to make sure our DCO order was revoked within two weeks, due to a blog post written by myself the previous year implying that preferential treatment was being given to larger companies so he could ‘cement his legacy.’ This refers to the ICE / Bakkt approval, which was running into issues that were frustrating the chairman,” he says.
Though the blog post that sparked this conflict has not been stated, LedgerX was required to acquire insurance and conduct a SOC 1 Type 2 audit before they could receive the license and it has been stated a CT FC staff tried to interfere with the audit itself. The second letter also notes that the application had been pending for 250 days and that typically, the CTFC has 180 days to approve or deny an application.