The Senate committee is planning to ensure that Bitcoin and Ethereum will be put under the commodity regulators. The Commodity Futures Trading Commission has the power to regulate the digital commodities market and will also manage BTC and ETH from here on. Currently, only the future derivatives fall under their jurisdiction. But, since there is a common agreement that Bitcoin is a commodity, the senate plans to put them under the CFTC.
The question of security vs commodity
For Bitcoin, there isn’t much of a problem as even the SEC believes that it is a commodity. Since there is no issuing authority, it passes the Howey test. However, for Ethereum, things might be different. There could be a debate on whether it is a security or commodity, and the current SEC and XRP lawsuit will have a major role in that. The SEC obviously wants to get as much regulatory power as possible. So, it wouldn’t come as a surprise to appeal that Ethereum is a security token.
The regulation needs to happen soon as there is hardly any oversight over cryptocurrencies. So, the authorities must work fast and ensure that a regulatory body soon oversees them. Senator John Boozman, who is behind the bill, says that the money of Americans is at risk.
Another Senator, Debbie Stabenow, said that the idea of not categorizing crypto under securities is just inside their jurisdiction. They are staying in their lane, as crypto commodities can be transferred between people without any middleman. The bill proposed by them also says that whatever crypto the SEC doesn’t call out to be securities can be categorized under commodities by them.
It is good for crypto
Having clear regulations and stability is very important for the growth of any industry. We cannot just expect crypto companies and the SEC to continue fighting over securities, commodities, or utility coins. So, there needs to be a bill that defines what they are and for what reason. Sam Bankman fried, CEO of FTX, also tweeted about this new bill and how it is positive for crypto.
What are your thoughts on the Senate bill that says Bitcoin and Ethereum will be under commodity regulators? And do you think it is positive for the industry? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.