- Jul 27, 2021
On October 3 press release the Commodity Futures Trading Commission ruled by Senior Judge Rya W. Zobel of the U.S. District Court for the District of Massachusetts revealed a case involving now-defunct cryptocurrency My Big Coin, that the digital currencies to be classified as commodities.
Earlier in this year on September 26 Senior Judge ruled an order holding that the Commodity Futures Trading Commission (CFTC) has the power to prosecute fraud involving virtual currency.
As going with the CFTC’s arguments, the Court held that the CFTC had sufficiently alleged that the particular virtual currency at issue, My Big Coin (MBC), was a commodity under the Commodity Exchange Act (CEA).
The court states that the term “commodity” specifies an “a host of specifically enumerated agricultural products as well as ‘all other goods and articles and all services rights and interests.”
In August the CFTC vs. Mcdonnell case has also provided with the glimpse of the authority of the CFTC over cryptocurrencies. Judge Weinstein in the Eastern District of New York sided with the derivatives watchdog against Patrick Mcdonnell and his company, Cabbage Tech. Corp. dba Coin Drop Markets.
Another reference is of the June 2016 case. It is also significant as the case of Bfxna Inc. dba Bitfinex. Bitfinex was fined with $75,000 by CFTC for offering illegal off-exchange financed retail commodity transactions and failing to register as a futures commission merchant. Zobel states that the Bitfinex case shows that cryptocurrencies are “properly defined as commodities.”
Lastly, the other case that confirms bitcoin were recognized as commodities is the September 2015 case involving bitcoin options trading platform operator Coinflip Inc. and its CEO. Hence proving that the cryptocurrencies are commodities in the U.S.