CFTC Chair: Ether, Stablecoins Qualify as Commodities

• CFTC chairman, Rostin Behnam, reaffirmed his stance that ether (ETH) and stablecoins should be regulated as commodities.
• This is in contrast to the SEC’s position that only Bitcoin (BTC) is a commodity.
• The CFTC has taken a more lenient approach to crypto regulation, with the settlement of USDT stablecoin issuer Tether in 2021 being seen as a sign of this.

CFTC Chair Reaffirms Stance on Ether and Stablecoins

CFTC chair Rostin Behnam has reaffirmed his stance that ether (ETH) and stablecoins should be regulated as commodities. This idea was presented during a Senate Agriculture committee hearing on March 8, where Senator Kirsten Gillibrand asked Benham about the differing stance of the CFTC and the Securities and Exchange Commission (SEC).

Differing Approaches by CFTC & SEC

The CFTC believes bitcoin (BTC) and many altcoins are commodities, while its counterpart, the SEC has made it clear over time that BTC may be the only true commodity in the entire digital assets space. In contrast to this heavy-handed approach from the SEC, the CFTC has taken a more lenient approach to crypto regulation with their enforcement team recognizing the status of stablecoin Tether as a commodity upon settlement in 2021.

Chairman Behnam’s Rebuke

Chairman Benham’s comments were seen as an impassioned rebuke of both ‚everything except BTC is a security‘ and ’stablecoins are securities‘ positions which have been put forward by Gary Gensler’s SEC in recent times.

CFTC & Enforcement Actions

In 2022, Gensler’s administration executed 50% more enforcement actions against crypto projects than any other period under his leadership; however, Benham clarified that he still believes these digital assets should be treated differently than regular securities due to their decentralized nature.

Conclusion

Overall, Chairman Benham highlighted his belief that both ether and stablecoins are commodities rather than securities; as such they should be regulated differently than other traditional financial instruments. Going forward it will be interesting to see how both regulatory bodies handle these digital assets moving into 2023.