CFTC Says Bitcoin, Ethereum and Litecoin Are Commodities in Lawsuit Against Binance and CEO Changpeng Zhao

The Commodities Future Trading Commission (CFTC) thinks Bitcoin (BTC), Ethereum (ETH) and Litecoin (LTC) are all securities, according to a new complaint.

Earlier this week, the CFTC charged top crypto exchange Binance, its CEO Changpeng Zhao, and the company’s former chief compliance officer Samuel Lim with a long list of regulatory violations, jolting the digital asset markets with uncertainty.

Reads the complaint,

“Beginning no later than July 2019 and continuing through the present (the ‘Relevant Period’), Binance, under Zhao’s direction and control and with Lim’s willful and substantial assistance, has solicited and accepted orders, accepted property to margin, and operated a facility for the trading of futures, options, swaps, and leveraged retail commodity transactions involving digital assets that are commodities including Bitcoin (BTC), Ether (ETH), and Litecoin (LTC) for persons in the United States.”

This assertion directly cuts against comments made by U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler, who earlier this year claimed that every coin besides Bitcoin is a security.

Argues Gensler,

“Everything other than Bitcoin, you can find a website, you can find a group of entrepreneurs, they might set up their legal entities in a tax haven offshore, they might have a foundation, they might lawyer it up to try to arbitrage and make it hard jurisdictionally or so forth…

They might drop their tokens overseas at first and contend or pretend that it’s going to take six months before they come back to the US. But at the core, these tokens are securities because there’s a group in the middle and the public is anticipating profits based on that group.”

CTFC Chair Rostin Behnam pushed back against Gensler’s comments directly earlier this month, arguing that ETH is categorically a commodity.

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