In or out? – the CFTC explains when virtual currencies come within its jurisdiction
Journal of Investment Compliance
ISSN: 1528-5812
Article publication date: 25 November 2020
Issue publication date: 15 December 2020
Abstract
Purpose
To summarize and explain the U.S. Commodity Futures Trading Commission’s (CFTC’s) guidance regarding whether cryptocurrency is subject to CFTC jurisdiction.
Design/methodology/approach
The article reviews the CFTC’s March 24, 2020 final interpretive guidance, summarizes the history of the agency’s jurisdiction over leveraged, margined or financed retail transactions, and relates it to the CFTC’s guidance and judicial decisions regarding cryptocurrency.
Findings
We found that the CFTC, in carrying out its leadership role related to developments in the fintech industry, had provided clarity about its jurisdiction over cryptocurrency. The CFTC defines virtual currency as a “commodity,” even if intangible, and finds that many transactions in virtual currency satisfy the exception to the CFTC’s jurisdiction over leveraged retail commodity transactions because “delivery” can be said to occur within 28 days.
Originality/value
The article provides a useful summary of an important pronouncement from the CFTC in a manner that is readily understandable and relatable to industry participants and legal practitioners in this field.
Keywords
Citation
Nathan, D. and Mathews, N. (2020), "In or out? – the CFTC explains when virtual currencies come within its jurisdiction", Journal of Investment Compliance, Vol. 21 No. 2/3, pp. 167-169. https://doi.org/10.1108/JOIC-09-2020-0026
Publisher
:Emerald Publishing Limited
Copyright © 2020, Daniel Nathan.