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CFTC Chairman Heath Tarbert explained that Ether (ETH) is a commodity. Ether is the cryptocurrency used on the Ethereum platform, one of the largest and most popular networks in the cryptocurrency market.
ETH Is A Commodity
In a recent interview with Yahoo Finance’s All Markets Summit in New York City, Tarbert said on stage that Ether is a commodity.
Considering ETH is a commodity, it falls under the jurisdiction of the CFTC. Moreover, he anticipated that there are going to be Ether futures trading on U.S. markets in the near future.
He has also said that Bitcoin has already been considered a commodity but Ether had yet to be defined.
Tarbert commented about it:
“We’ve been very clear on Bitcoin: Bitcoin is a commodity. We haven’t said anything about Ether, until now. It is my view as chairman of the CFTC that ether is a commodity.”
This is in line with the views that the U.S. Securities and Exchange Commission (SEC) had on both Bitcoin and Ether, considering these two cryptocurrencies were not securities.
Nonetheless, the SEC added that several tokens released through Initial Coin Offerings (ICOs) were considered securities. During the last year, the SEC issued enforcement actions to several ICOs that were selling unregistered securities.
Tarbert went on saying that he knows there is uncertainty in the market in terms of regulations and legal status. However, he stated that ultimately, similar digital assets should be treated similarly.
In addition to it, he considered that coins created from hard forks such as Bitcoin Cash (BCH), Bitcoin Gold (BTG) or Ethereum Classic (ETC) should be treated by regulators in the same way as the original asset.
He went on saying that there could be some exceptions. If the recently forked asset raises securities law issues under the classic Howey Test, then there must be a deeper analysis.
Bill Hinman, the SEC director of corporate finance, explained last year that recently created cryptocurrencies are likely securities because they are sold to the market with the promise of growing in value.
At the same time, these tokens are usually sold to a wider audience rather than individuals that want to use a specific network.
At the same time, Tarbert said that an ICO token could start as a security but become a commodity in the future. Thus, there are some assets that will change over time.
The Internal Revenue Service (IRS) has also issued its first crypto tax guidance in five years.