CFTC Chair Rostin Behnam Reasserts Bitcoin (BTC) and Ethereum (ETH) Are Commodities

Rostin Behnam, the chairman of the Commodity Futures Trading Commission (CFTC), has once more asserted that Bitcoin (BTC) and Ethereum (ETH)

The chairman of the Commodity Futures Trading Commission (CFTC) has once again asserted that Bitcoin (BTC) and Ethereum (ETH) — the two largest cryptocurrencies by market value — are commodities as regulators continue engaging in a tug-of-war to secure oversight of the fast-growing digital assets industry.

A recent court ruling in Illinois might have just put an end to the debate over whether Bitcoin and Ether are commodities or securities, at least for now. As the two regulatory agencies continue battling over jurisdiction, the court's decision could have significant implications for the future of cryptocurrency regulation in the United States.

Bitcoin And Ether Are Commodities, Court Backs CFTC

During a hearing on July 9 before the US Senate Committee on Agriculture, Nutrition, and Forestry, CFTC chairman Rostin Behnam highlighted a key development in the ongoing legal battle between the CFTC and the state of Illinois over the classification of Bitcoin and other digital assets.

According to Behnam, the district judge in the case, Mary M. Rowland, sided with the CFTC and classified Bitcoin, Ether, Olympus (OHM), and KlimaDAO (KLIMA) as digital asset commodities, a decision that could have far-reaching implications for the regulatory landscape.

“The court, in its decision, also reaffirmed that both Bitcoin and Ether are commodities under the Commodity Exchange Act (CEA),” the CFTC boss asserted.

The CFTC had filed a complaint against a group of crypto firms in April 2023, alleging that they defrauded investors in a massive crypto fraud scheme and were offering and selling digital assets that were unregistered. The complaint also sought to determine whether Bitcoin, Ether, OHM, and KLIMA qualified as digital asset commodities.

Bitcoin (BTC) price today is $29,637.17 USD with a 24-hour trading volume of $32.23B USD. BTC price is up 6.66% in the last 24 hours, and up 3.38% in the last seven days with a circulating supply of 19,400,667 BTC.

Ꮯryptocurrency Secure Your Cryptoassets Keep your crypto secure with our advanced multi-signature protection.Best Price Get the best crypto prices from top exchangesᴊoin now.“what’s time to be alive Behnam further mentioned a 2022 report from the Financial Stability Oversight Council, which highlighted a gap in regulation of the spot market for crypto assets that are not securities and suggested his agency should take a greater role of oversight for digital commodities.”

Highlighting the importance of regulating the spot market for digital assets that are not considered securities, Behnam pointed to a 2022 report by the Financial Stability Oversight Council (FSOC). The FSOC had earlier proposed that CFTC should have a greater role in overseeing digital commodity markets.

“The FSOC report also noted that the Securities and Exchange Commission (SEC) has jurisdiction over fraud in the offer, purchase, or sale of any security, including digital asset securities, while the CFTC has jurisdiction over fraud in the offer, purchase, or sale of any commodity in interstate commerce, including digital asset commodities,” Behnam noted in his prepared remarks.

“In its December 2022 report, the FSOC observed that CFTC has broad authority over digital asset commodity markets but that the definition of ‘commodity’ under the CEA has not kept pace with the rapid evolution of digital assets,” he added.

“The Council further noted that there is a gap in federal regulatory oversight of the spot market for digital assets that are not securities, and it suggested that CFTC should take a greater role of oversight for digital commodities,” the CFTC chairman stated.

Behnam also noted that the SEC and CFTC frequently coordinate legal enforcement actions, but the two agencies lack regulatory coordination, which Behnam said “is hampering our ability to efficiently oversee the digital asset markets.”

“As a result, we are forced to rely on MOUs [memorandums of understanding] to try to coordinate our regulatory efforts, which is not an efficient use of our resources and creates uncertainty for the industry and the investing public,” he added.

CFTC officials first called Ethereum a commodity in 2019, when then-chief Heath Tarbert spoke at Yahoo Finance's All Market Summit. While the SEC has never publicly claimed that Ethereum is a security, a since-dropped probe into “Ethereum 2.0” sparked speculation. Moreover, the Gary Gensler-helmed commission greenlighted applications for spot ETH ETFs in May, suggesting it now views the second-largest crypto as a commodity.