The US Commodities and Futures Trading Commission (CTFC) has just announced that the digital currency known as Bitcoin (and other forms) can now be regarded as officially defined commodities just like oil and gold. Accordingly, the regulatory agency said, on Thursday, that it had settled the existing charges that had been filed against the San Francisco-based cryptocurrency exchange Coinflip, who had been suspected of trading bitcoin options through its online platform but without complying with CFTC guidelines.
“In this order, the CFTC for the first time finds that Bitcoin and other virtual currencies are properly defined as commodities,” the CTFC says, adding that many parties joined together to facilitate the sale of digital currency options. The order, thus, says that commodity option trading was not, in fact, performed in accordance with Regulations.
“The Order further finds that the activities related to commodity option transactions were not conducted in compliance with a provision of the CEA or a provision of the Regulations otherwise applicable to swaps, and were not conducted pursuant to the Regulation 32.3 ‘trade option’ exemption,” reported the regulatory agency.
Finally, The CFTC’s Director of Enforcement, Aitan Goelman, shares: “While there is a lot of excitement surrounding Bitcoin and other virtual currencies, innovation does not excuse those acting in this space from following the same rules applicable to all participants in the commodity derivatives markets.”
Now, anyone who would like to trade bitcoin futures (or derivatives, of course) will have to register as a Designated Contract Market or Swap Execution Facility. Furthermore, any firm caught being involved with any activities that might violate this law—and this includes futures manipulation—will, of course, face charges against CFTC.
Originally appeared at: http://www.piercepioneer.com/bitcoin-is-now-publically-traded-commodity/46790