Rostin Benham, the Chairman of the Commodities and Futures Trading Commission (CFTC), recently announced that an Illinois court has officially declared both Bitcoin (BTC) and Ethereum (ETH) as commodities. This decision effectively resolves the ongoing turf war between the CFTC and its sister agency.
During a U.S. Senate committee hearing, Benham stated that the court’s ruling reaffirmed that both Bitcoin and Ether fall under the definition of commodities as outlined in the Commodity Exchange Act. This confirmation stems from a summary judgment issued by Judge Mary Rowland in a U.S. district court in Illinois on July 3.
The case involved a defendant named Sam Ikkurty from Oregon who was found guilty of fraud and failure to register under the Commodity Exchange Act. Ikkurty had lured investors into his funds by promising them 15% annual returns paid out in “digital asset commodities,” including Bitcoin and Ethereum.
In addition to Bitcoin and Ethereum, the court also recognized two other non-Bitcoin virtual currencies, OHM and Klima, as commodities falling under the CFTC’s jurisdiction. This decision marks a significant step towards clarifying the regulatory status of various cryptocurrencies in the United States.
While Bitcoin has been classified as a commodity for some time, there has been uncertainty surrounding the status of Ethereum. The Securities and Exchange Commission (SEC) has not provided a clear statement on whether it considers Ether to be within its regulatory purview. However, recent developments, such as the approval of Ether spot ETFs by the SEC, suggest that Ethereum is increasingly being viewed as a commodity.
This implicit acceptance of Ethereum as a commodity has prompted other cryptocurrency firms, like VanEck, to explore the possibility of launching similar products based on other digital assets such as Solana (SOL). The push for regulatory clarity in the cryptocurrency market is gaining momentum as more players seek to enter the space with innovative financial products.
In light of these developments, Benham urged Congress to grant the CFTC explicit authority to require disclosures from registrants launching commodity-based tokens. He emphasized the need for a balanced framework that distinguishes between tokens classified as commodities and those considered securities under existing laws.
Overall, the court’s decision in Illinois solidifies the status of Bitcoin and Ethereum as commodities, providing greater clarity for market participants and regulators alike. As the cryptocurrency industry continues to evolve, regulatory bodies must adapt to ensure investor protection and market integrity.