Ether Declared Commodity:
The community hopes that the CFTC’s allegation will end claims that staked coins meet the Howey Test’s definition of securities.
In a court filing on December 13, the Commodity Futures Trading Commission (CFTC) declared Ether to once again be a commodity, in contradiction to remarks made by the agency’s head Rostin Behnam on November 30 that Bitcoin was the only cryptocurrency that should be regarded as a commodity.
According to the CFTC, as per their filing today, ETH is a commodity. This really should put any security designation to rest. pic.twitter.com/PkHWredNK4
— Hal Press (@NorthRockLP) December 13, 2022
The regulator repeatedly referred to Ether, Bitcoin, and Tether (USDT) in its action against Sam Bankman-Fried, FTX, and sister business Alameda Research as “commodities” under US law.
According to Section 1a(9) of the Act, 7 U.S.C. 1a(9), “some digital assets constitute “commodities,” including bitcoin (BTC), Ether (ETH), tether (USDT), and others.
However, in recent weeks, there seems to have been significant dissent inside the CFTC itself about whether Ether should be treated as a commodity.
CFTC chief Rostin Benham:
On November 30, at a crypto symposium at Princeton University, CFTC chief Rostin Benham allegedly suggested that only Bitcoin should be considered a commodity, reversing earlier statements that Ether might potentially qualify.
Gary Gensler, the chairman of the Securities and Exchange Commission, has also been unsure about his position on Ether recently.
On June 27, Gensler acknowledged that Bitcoin was a commodity in an interview with Jim Cramer for the hosts’ Mad Money show, adding, “That’s the only one I’m going to say.”
In the past, Gensler has claimed that while Ether was once a security, it has subsequently become more decentralised and transformed into a commodity.
After Ether switched to proof-of-stake (PoS), his position seemed to have changed again in September when he asserted that staked tokens might qualify as securities under the Howey test.
Categorizing crypto assets in the US is crucial because the Securities and Exchange Commission (SEC) oversees securities like bonds and stocks. At the same time, the Commodity Futures Trading Commission (CFTC) supervises commodities futures (SEC).
Bitcoin skeptic At a financial services conference on December 6, Intercontinental Exchange Inc. CEO Jeffrey Sprecher expressed confidence that crypto assets will be treated like securities, leading to greater consumer protection. Senator Elizabeth Warren is reportedly working on a bill to give the SEC the majority of the regulatory authority over the cryptocurrency industry.
However, Belgium has taken a different perspective on the matter, stating in a study published on November 22 that Bitcoin, Ether, and other crypto assets created exclusively through computer code do not qualify as securities.