The community hopes that the CFTC’s approval will dispel claims that trapped coins are securities according to the Howey test.
CFTC named Ether once again
Contrary to President Rustin Behnam’s November 30 statement suggesting that Bitcoin is the only cryptocurrency that should be considered a commodity, this time in a court filing on 13 December as a commodity.
The regulator referred to Ether and Bitcoin multiple times in its lawsuit against Sam Bankman-Fried, FTX and sister company Alameda Research.
As “goods” “among other things” under US law.
“Certain digital assets, including Bitcoin (BTC), ether (ETH), tether (USDT), and others, are “goods” as defined by Section 1a(9) of the Code, 7 US § 1a(9).
However, there seems to have been some disagreement within the CFTC itself, at least in recent weeks, over whether to consider ether a commodity.
During a crypto event at Princeton University on Nov. 30, CFTC chairman Rustin Benham reportedly backed out from previous comments claiming that ether could also be a commodity, suggesting that bitcoin is the only crypto asset that should be viewed as a commodity.
SEC Chairman Gary Gensler has also taken an ambiguous stance on Ether in recent months.
In an interview with Jim Cramer during Mad Money on June 27, Gensler confirmed that Bitcoin is a commodity and added: “That’s all I’m going to say.”
Gensler had previously suggested that ether was a security after the initial coin offering, but has since become more decentralized and commodified.
His position appears to have shifted again after Ether’s transition to proof-of-stake, with Gensler arguing in September that the stacked tokens could form securities under the Howey test.
Identification of crypto assets is particularly important in the US, as commodity futures are regulated by the CFTC while securities such as bonds and stocks are regulated by the Securities and Exchange Commission (SEC).
Related: Judge Orders CFTC to Sue Ooki DAO Founders
Crypto skeptic Senator Elizabeth Warren is reportedly working on a bill that would give the Securities and Exchange Commission the most regulatory power over the crypto industry. Intercontinental Exchange Inc CEO Jeffrey Sprecher is also confident that crypto assets will be treated like securities – suggesting at the December 6 Financial Services Conference that this will lead to greater protection for consumers.
Belgium took a different stance as the Financial Services and Markets Authority confirmed on November 22 that bitcoin, ether, and other crypto-assets issued by computer code alone do not constitute securities.