CFTC reverses course: Ethereum out, only Bitcoin is a commodity

In a clear reversal of fortune, Rostin Behnamthe head of the CFTC, who until recently seemed to classify Ethereum as a commodity (commodities), seems to agree with SEC chief Gensler. In a speech this week, he stated that. only bitcoin was a commodityeffectively classifying ether as a financial security (security).

Change of course by the head of the CFTC.

The Chairman of the Commodity Futures Trading Commission (CFTC).Rostin Behman has been in the spotlight since the spectacular FTX crash – like all U.S. regulators? Probably a bit more, insofar as he admitted that he and his team had met with Sam Bankman-Fried (SBF) and other FTX officials a dozen times in the year prior to its collapse.The reason? FTX wanted the CFTC to serve as a clearinghouse for derivatives, while allowing direct margin trading. In fact, by law, the regulator had to process the application so as not to default on its obligations.

Firmly rejecting any form of complacency towards the defunct platform and its leader, Rostin Behnam appears to have distanced himself from the Democratic bill carried by the SBF in the same vein. The famous ” Law on consumer protection of digital products “The main objective of the Act was not to classify Ethereum as a securities to escape the control of the Securities and Exchange Commission.. “A big step forward,” according to Behnam….

But at a conference hosted by Princeton University, the CFTC chief clearly revised his position on the debate that has been roiling the U.S. regulatory scene for years, namely the legal categorization of cryptocurrencies. It is important to know The United States is one of the only countries in the world with dual regulatory authority for tracking equities and derivatives. In most other countries, the jurisdictions are merged into a single authority.

Ethereum is not a commodity

This turn has not gone unnoticed, since until October this year it advocated a broader conception. Thus, until then, according to Rostin Behnam, a certain number of altcoins, including the first on the market, had to be effectively in the category of goods. A category which, it should be recalled, is the responsibility of his agency, the securities under the authority of the SEC.

Finally, more specifically, it implicitly excluded ether from the scope of commodities by stating. according to the journal Forbes, that “the only cryptocurrency that should be considered a commodity is bitcoin.”

A setback for the U.S. cryptocurrency industry, which was leaning toward the CFTC becoming its regulator. Originally, the idea was that the agency would has a conception of regulation more adapted to the changing realities of the cryptocurrency market and increasingly sophisticated financial engineering. Unlike the SEC, which, in the view of some, has a tendency to cling to old ideas by systematically referring back to laws from another century. From this observation, the general feeling was that the CFTC would be more flexible in its framework. This perception was countered by Rostin Behnam, again in his Princeton speech, who said that he was not in favor of crypto and that digital assets lacked real use cases beyond speculation.