CFTC Chair Says Stablecoins Are Commodities At Senate Agriculture Listening to
Posted On March 12, 2023
Rostin Behnam, the Chairman of the Commodities and Futures Trading Commission (CFTC) said that Ethereum ETH/USD, the second-largest cryptocurrency after Bitcoin BTC/USD, is a commodity.
Behnam testified on Wednesday before the Senate Agriculture Committee, that Ethereum is a commodity because “It’s been listed on CFTC exchanges for quite some time.”
Rostin Behnam emphasized that the CFTC has the legal authority to regulate derivatives markets trading Ethereum and other underlying markets. Furthermore, he asserted that any Ethereum futures products listed on a platform under the purview of the CFTC have been done with its explicit approval. This provides a strong “jurisdiction hook” for the Commission. Watch:
His opinion seems to run counter to that of SEC chairman Gary Gensler, who argued last month that “everything other than Bitcoin” falls under securities.
Behnam also believes stablecoins should be classified as commodities — rather than securities — unless legislation expressly declares otherwise.
Currently, the CFTC defines a commodity as any physical or virtual item that is capable of being bought or sold and that is used for commerce. This definition includes agricultural products, natural resources, precious metals, energy, and financial instruments such as currencies, interest rates, and stock indices.
The CFTC also defines certain intangible items as commodities, including:
- Digital assets: Virtual currencies like Bitcoin, Ether, and Litecoin are considered commodities by the CFTC.
- Weather derivatives: Financial instruments that allow companies to manage risks associated with weather events, such as hurricanes, are considered commodities.
- Emission allowances: Financial instruments that allow companies to trade pollution credits are also considered commodities.
Overall, the CFTC’s definition of a commodity is broad and flexible, allowing for a wide range of products to be traded on commodity exchanges.
This article was originally published on Benzinga and appears here with permission.