The CFTC's head argued that most stablecoins could be considered commodities if Congress doesn't pass a comprehensive law
Commodity Futures Trading Commission Chair Rostin Behnam argues that fiat-based stablecoins would be considered commodities if Congress doesn’t pass a comprehensive regulatory law for digital assets.
That interpretation appears to put the CFTC and Securities and Exchange Commission on different pages on another digital asset-related topic. Last month the SEC notified Paxos that its U.S.-pegged stablecoin with Binance, BUSD, was an unregistered security. Paxos announced that it had stopped minting BUSD tokens after receiving the SEC notice.
The SEC has not formally declared whether ether is a non-security asset, but in 2018 the then-SEC Director of Corporation Finance Bill Hinman said he viewed ether as the Ethereum network at that point as"decentralized" to the extent that,"current offers and sales of Ether are not securities transactions." Hinman has since returned to private practice and Gensler took leadership of the agency in 2021.
The CFTC chair added that such legislation could aid regulators in cracking down on activity by offshore crypto firms that violate U.S. law, as FTX allegedly did. That bill would have granted the CFTC more direct power over crypto exchanges and spot markets, as the CFTC can only proactively regulate commodity derivatives and pursue fraud and market manipulation through enforcement. Comprehensive stablecoins legislation drafted by current House Financial Services Committee Chair Patrick McHenry, R-N.C., and now Ranking Member Maxine Waters, D-Calif.
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