CFTC Chairman Optimistic on Launch of Ethereum Futures and other Crypto Derivatives

CFTC Chairman Heath Tarbert confirmed his belief at the DC Fintech Week that Ethereum futures are around the corner. In all probability, sometime between 6 months to a year (post-April 2020).

According to an excerpt from the conversation by the fireside with reporters and crypto-enthusiasts, the chairman noted that, currently, CFTC only views Bitcoin and Ethereum as a commodity. Nevertheless, he was positive about some of the other crypto assets as well.

Chairman Tarbert noted that spot exchanges fit the definition of “wild west.” Together with the SEC, the Gov. agency is working to regulate these assets. In most cases, assets not classified as security are put into the category of commodity.

Furthermore, in an important note, he also cited that the transition of the taxonomy of an asset is also possible. Something termed as a commodity today, could turn into a security tomorrow and vice-versa.

The transition will be the First in Financial History

However, until now, there has been no precedence of such a transformation. Nic Carter, the co-founder of Coinmetrics and partner at Castle Ventures, asked the Chairman about an example of such a transition, to which he replied, “None that I’m aware of.”

Crypto community sent a mixed response to the Chairmans’ comment. Zack Voell, a crypto-analyst from Messari tweeted,

I’ll take well-reasoned decisions sans precedent over the inverse any day.

However, Gabor Gurbacs from VanEck wasn’t satisfied with the view, he tweeted,

Sets a terrible precedent in my view with long term business uncertainty implications and legal ramifications that will likely be abused in predominantly common-law-governed jurisdictions. An orange doesn’t just become a potato!

He believes that this option could be exploited in the future to gain unethically. Moreover, while an entity predominantly controls security, a commodity is ubiquitous. Hence, even after the fair distribution of crypto assets, the transition wouldn’t make any sense.

Crypto Derivatives: The future

Apart from Ethereum and Bitcoin, CFTC is also preparing to view at other crypto assets. Bitcoin Cash [BCH], Litecoin [LTC], XRP, and some of the other cryptocurrencies are traded as commodities in parts of Europe.

However, the process takes more time that one perceives. Chairman Tarbert noted that ‘they’re hiring’ and working to build the capacity to views these assets, including stablecoins.

The SEC is working towards implementing security laws and has also charged the sale of crypto-assets without registration.

Also Read: CFTC, FinCEN, and SEC Issue Warnings to Crypto Firms on Regulatory Compliance

Furthermore, the new view from the CFTC opens a two-way street, the plan with which crypto-assets like EOS, Tron, Cardano’s (ADA), and so on were initially distributed. However, stringent deliberation and conditions can be expected for commodity status.

Which crypto-assets do you think will be next in CFTC’s view after Ethereum and Bitcoin? Please share your opinions with us. 

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