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US Federal Judge Rules Cryptocurrencies Are Commodities

March 07, 2018 17:15
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Last week, Securities and Exchange Commission (SEC) had issued a number of subpoenas and information requests to advisors and technology companies that are currently operating out of United States’ cryptocurrency market.

On the occasion, the Chairman of SEC and U.S. Commodity Futures Trading Commission (CTFC) had been present and both had majorly positive remarks to make on the cryptocurrency market.

However, in a twist, the ambiguity surrounding the position of cryptocurrencies in the United States has been cleared up. On Wednesday a federal judge, Jack Weinstein ruled that CTFC can now classify and regulate cryptocurrencies as commodities. He said his ruling was supported by the plain meaning of the word ‘commodity’ and the CTFC had the right to interpret the federal law regulating cryptocurrencies.

The case came up when CTFC filed a complaint against a New York resident Patrick McDonnell. The judge has also directed CTFC to initiate proceedings against McDonnell and pass an injunction which effectively stops Coin Drop Markets’ website for carrying out any transaction.

This judgement comes as a victory for the CTFC as it had declared way back in 2014 that cryptocurrency is a commodity and can be subject to regulatory body’s interference.

Last week, the chairman of CTFC had said, “We owe it to this new generation to respect their interest in this new technology with a thoughtful regulatory approach.”

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