Stablecoins and Ether will become commodities, says CFTC chair.

Key Takeaways

• Crypto Bill draft is said to be released by April, as per Senator Gillibrand.
• CFTC is taking a stand about Ether and Stablecoins.

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The rise of the crypto space followed by the mass adoption of the asset class soon garnered the attention of the regulators for various questions that needed answers. With that, there has gradually been a situation of the tug-of-war among the US regulators over the controlling of these said crypto assets. Following the situation, the CFTC chair has triple downed his stance in stating that Ether and stablecoins are commodities.

This is a pretty stark (almost impassioned?) rebuke of the ‘everything except BTC is a security’ and ‘stablecoins are securities’ positions. Would be great if the CFTC released the legal analysis on these issues Chairman Behnam says it did. https://t.co/RIeTgUxTFd pic.twitter.com/LGtuEPs4X3

— Lawtoshi (@lawtoshi) March 8, 2023

While at a recent Senate hearing, along with stating that Ether and stable coins are commodities, the chairman of the United States Commodity Futures Trading Commission or commonly referred to as CFTC,  Rostin Behnam, also stated that being commodities, they should come under the purview of the CFTC.

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During the Senate Agriculture Hearing on March 8, 2023, Senator Kirsten Gillibrand asked Rostin Behnam about the different views that is held by the regulator and the Securities and Exchange Commission or SEC following the 2021 CFTC settlement, to which Behnam said, “Notwithstanding a regulatory framework around stablecoins, they’re going to be commodities in my view. It was clear to our enforcement team and the commission that Tether, a stablecoin, was a commodity.”

Previously, the CFTC has asserted that crypto assets like, Bitcoin, Ethereum and Tether are considered by them as commodities. While asked for proof or evidence that CFTC will be able to put forward in order to win regulatory influence over Ether during the recent Senate hearing, Rostin Behnam replied that they would not have allowed the Ether futures products to be listed on the CFTC exchanges if they were not siding with the token being a “commodity asset”. He also added, “We have litigation risk, we have agency credibility risk if we do something like that without serious legal defenses to support our argument that [the] asset is a commodity.”

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This comment have evidently cemented Behnam’s wavering opinion on the classification of Ether.

During the Senate hearing, as per comments from Gillibrand, the next draft of the crypto bill will be available by mid-April. She said, “Our ambition is to make sure that there is a place to start a national conversation about a holistic approach to digital assets. To make sure that digital assets have the character of securities are regulated by the SEC, to have the assets that have the [unintelligible] of commodities are regulated by the CFTC, to make sure stablecoins can be overseen by the OCC, to make sure that there are tax provisions for the entire industry.”