In an attention-grabbing growth, the U.S. Commodities and Futures Trading Commission (CFTC) exerted jurisdictional energy over Ethereum and stablecoins whereas calling them commodities. With this, the CFTC units a direct confrontation with the U.S. SEC which is keen to treat all cryptocurrencies, besides Bitcoin, as securities.
Interestingly, the most recent growth additionally reveals the non-alignment amongst US regulators to control the crypto house. Addressing the Senate Agriculture Committee on Wednesday, March 8, CFTC Chair Rostin Behnam said:
“Not withstanding that, they are a commodity, and we have to police that market without a clear direction from Congress that they’re some other type of asset. Based on the cases that we’ve brought around stablecoins, I think that there’s a strong legal argument that USDC and other similar stablecoins would be commodities”.
The CFTC chair added that the fiat-backed stablecoins don’t work with the expectation of revenue and return to its holder. Thus, Behman was hinting that stablecoins shouldn’t fall within the class of securities.
Also, the CFTC chair cited the investigation into Tether throughout a 2021 lawsuit. After that, Tether agreed to pay $40 million in settlement fees.
CFTC Chair Calls Ethereum A Commodity
Not solely stablecoin, however Behnam additionally said that Ethereum, the world’s second-largest cryptocurrency and Bitcoin competitor, can be a commodity. He added: “It’s been listed on CFTC exchanges for quite some time, and for that reason,” it creates a “direct jurisdictional hook” for the CFTC to take care of the Ethereum derivatives and underlying market.
“We would not have allowed the Ether futures product to be listed on a CFTC exchange if we did not feel strongly that it was a commodity asset,” added the CFTC chair. Furthermore, he added that his company has “serious legal defences” to help their case.
Additionally, Rostin Behnam referred to as out the Congress, in search of extra readability relating to the jurisdictional powers in regulating the crypto house. Behnam additionally demanded complete regulatory laws from Congress including that enforcement alone shouldn’t be sufficient to handle the dangers and client safety points in crypto.
“And as our markets have proven, as our regulations have proven over many, many decades, comprehensive regulation can prevent fraud, can prevent manipulation, and can stabilize markets and ultimately protect customers,” he stated.
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