The community is hoping that the CFTC’s statement will put to rest concerns that staked coins are securities under the Howey Test.
In a Dec. 13 court filing, the Commodity Futures Trading Commission (CFTC) categorized Ether as a commodity, contradicting remarks made by head Rostin Behnam on Nov. 30, which stated that Bitcoin was the only cryptocurrency that should be treated as a commodity.
The regulator refers to Ether, Bitcoin, and Tether (USDT) as “commodities” under US law on many times in its case against Sam Bankman-Fried, FTX, and sister business Alameda Research.
“According to Section 1a(9) of the Act, 7 U.S.C. 1a(9), some digital assets, such as bitcoin (BTC), ether (ETH), tether (USDT), and others, are “commodities.”
However, at least in recent weeks, there seems to be significant dispute inside the CFTC itself over whether Ether should be considered a commodity or not.
CFTC chairman Rostin Benham allegedly indicated during a crypto event at Princeton University on Nov. 30 that Bitcoin is the sole crypto asset that should be treated as a commodity, contradicting prior remarks that Ether may potentially be a commodity.
Gary Gensler, the head of the Securities and Exchange Commission, has similarly taken an uncertain position on Ether in recent months.
On June 27, on the hosts’ Mad Money program, Gensler affirmed that Bitcoin was a commodity, adding, “That’s the only one I’m going to say.”
Gensler previously said that Ether was a security during its initial coin offering but has subsequently decentralized and become a commodity.
After Ether’s switch to proof-of-stake (PoS), his attitude seemed to flip again in September, when he stated that staked tokens may qualify as securities under the Howey test.
The classification of crypto assets is especially relevant in the United States, since the CFTC oversees commodities futures, and the Securities and Exchange Commission supervises securities such as bonds and stocks (SEC).
Senator Elizabeth Warren, a crypto skeptic, is reportedly working on legislation that would give the SEC most of the regulatory authority over the crypto industry, and Intercontinental Exchange Inc. CEO Jeffrey Sprecher is also confident that crypto assets will be treated as securities, implying that this would result in greater consumer protections at a financial services conference on December 6.
Belgium, on the other hand, has taken a different stand on the categorization, claiming in a November 22 report that Bitcoin, Ether, and other crypto assets produced exclusively by computer code do not constitute securities.
