CFTC “Happy” to ...

CFTC “Happy” to Take Over from SEC as Crypto Regulator, Says 80% of Coins are Commodities

By José Oramas July 11, 2024 In Cryptocurrency, Cryptocurrency Law, SEC

CFTC Chairman Rostin Behman has claimed that most crypto assets are not securities.
He also said the CFTC has the resources and capabilities to regulate the cryptocurrency industry in the US instead of the SEC.
Behman also warned that US regulators’ inaction will cause more damage to the crypto industry and investors over time.

While the US Securities and Exchange Commission (SEC) has not figured out whether Ethereum (ETH) is a security or not, the Commodity Futures Trading Commission (CFTC) has stated that it is rather a commodity, alongside Bitcoin (BTC) and other crypto tokens.

Rostin Behman, Chairman of the CFTC, stated that 70% to 80% of cryptocurrencies are commodities, not securities, at a July 9 hearing before the US Senate Committee on Agriculture, Nutrition, and Forestry.

Besides BTC and ETH, Behman classified Olympus (OHM) and KilmaDAO (KLIMA) as commodities.

In its decision, the court re-affirmed that both Bitcoin and Ether are commodities under the Commodity Exchange Act.”

Rostin Behman

Behman said, referring to a Ponzi scheme in which OHM and KLIMA were used in a scheme to lure investors into annual returns of over 15%.

Most crypto community members received Behnam’s congressional testimonies as positive for the industry, highlighting the Chairman’s ruling as bullish news for the market.

Who Should Regulate Crypto?

Another hot take in the crypto community sprung after Senator Roger Marshall asked if it would be better to let the CFTC oversee crypto regulations instead of the SEC.

Both agencies have a certain level of jurisdiction regarding crypto and can apply enforcement actions against projects, companies, or individuals who engage in unlawful behaviours. However, the regulatory landscape for cryptocurrencies in the US is not entirely clear, often leading to disputes between agencies over control.

For one, the SEC has sent mixed signals regarding ETH’s status in the market. In 2018, the agency deemed ETH not to be a security. But in 2023, it made a 180 and began conducting multiple investigations into Ethereum and the ecosystem. Consensys, a blockchain software company, sued the SEC in April 2024.

Instead, the CFTC’s former chairman, Heath Tarbert, had already classified Ethereum as a commodity in 2019 during Yahoo Finance’s All Market Summit.

Tarbert stated:

It is my view as Chairman of the CFTC that ether is a commodity, and therefore it will be regulated under the CEA. And my guess is that you will see, in the near future, ether-related futures contracts and other derivatives potentially traded.