Four Court Cases Confirm Cryptocurrencies Are Commodities in the US

Cryptocurrencies are commodities, according to four court cases involving the U.S. Commodity Futures Trading Commission (CFTC). A federal judge recently ruled that a token is a commodity, certifying the CFTC’s authority to prosecute fraud and manipulation in the crypto space. In her ruling, the judge cited three other crypto-related cases that arrive at the same conclusion.

Cryptocurrencies Are Commodities

Following last week’s ruling, the CFTC announced Wednesday:

CFTC Director of Enforcement, James Mcdonald, emphasized that “This is an important ruling that confirms the authority of the CFTC to investigate and combat fraud in the virtual currency markets.”

In the My Big Coin Pay Inc. case, the defendants argued that MBC is not a commodity because it “does not have future contracts or other derivatives trading on it.” However, the judge disagreed and ruled that it is a commodity and the CFTC has the authority to pursue fraud charges against the coin issuer and its founder.

The CFTC vs. Mcdonnell Case

This case “recognizes the broad definition of commodity under the CEA [Commodity Exchange Act], and also that the CFTC has the power to prosecute fraud with respect to commodities including virtual currencies,” the agency described.

In her ruling last week, Judge Zobel explained that the Mcdonnell case shows:

The Bitfinex Case

According to Zobel, the Bitfinex case shows that cryptocurrencies are “properly defined as commodities.”

The Coinflip Case

This September 2015 case involves bitcoin options trading platform operator Coinflip Inc. and its CEO. “In this first action against an unregistered bitcoin options trading platform, the CFTC holds that bitcoin and other virtual currencies are a commodity covered by the Commodity Exchange Act,” the agency detailed, noting: