CFTC Defines Bitcoin and Digital Currencies as Commodities

Baron

Baron

ET Founder
The US Commodity Futures Trading Commission (CFTC) issued its first action against an unregistered bitcoin options trading platform, ordering the startup to cease operations and simultaneously settling the case.

The CFTC charged San Francisco-based startup Derivabit with conducting activity related to commodity options, without registering with the agency or meeting rules for exemption.

The CFTC's ruling also confirmed that bitcoin and other digital currencies are commodities covered by the Commodity Exchange Act (CEA).
 
Baron said:
The US Commodity Futures Trading Commission (CFTC) issued its first action against an unregistered bitcoin options trading platform, ordering the startup to cease operations and simultaneously settling the case.

The CFTC charged San Francisco-based startup Derivabit with conducting activity related to commodity options, without registering with the agency or meeting rules for exemption.

The CFTC's ruling also confirmed that bitcoin and other digital currencies are commodities covered by the Commodity Exchange Act (CEA).
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This is very interesting, both from a big picture view and the legal maneuverings of this case. They essentially picked on a small entrepreneur who folded pretty much as soon as he realized he was going to run into CFTC opposition, so he isn't going to fight back on the key issue, which is the definition of virtual currency as a commodity and that this is a swap they can regulate. There was significant concern when Dodd Frank came out that renewable energy credits would be classified as a commodity subject to CFTC regulation, and in the end they ruled that they weren't. The logic applied to that decision would apply even more so to virtual currency, so I wonder if anyone is going to push back against either decision using the inconsistency.
 
IRS: Property
CFTC: Commodity
Judge: Currency
SEC: Security
TSA: Cash

Many call it a Protocol.

i960 joked that it's "A TERRORIST THREAT!"

:)
 
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