On Monday, the US Commodity Futures Trading Commission released an advisory for any exchanges registered under it that provides a measure of guidance in case they wish to list any “virtual currency derivative products.”
The advisory came from the Division of Market Oversight (DMO) and Division of Clearing and Risk (DCR).
“CFTC staff is providing this information, in part, to aid market participants in their efforts to design risk management programs that address the new risks imposed by virtual currency products. In addition, the guidance is designed to help ensure that market participants follow appropriate governance processes with respect to the launch of these products,” said Brian Bussey, director of the DCR.
The information contained within the advisory deals with subjects such as CFTC staff cooperation, risk management, and market surveillance. Despite all the clarifications by the CFTC, US regulations on cryptocurrency are still a labyrinth of confusion for many organizations—including the CFTC itself.
A bit over a week ago, a commissioner for the agency expressed concerns with regards to how Ethereum should be classified, throwing the ball at the SEC for an answer.
“You have to regulate what exists in the market, and if things change, you need to recognize that things have changed. But if someone has issued, through an [ICO], a security, then that was an unregistered security sale and the SEC deserves to be able to have jurisdiction over that and if necessary, prosecute,” said commissioner Brian Quintenz.
While the SEC insists that Ether coins fall under its jurisdiction as securities, the CFTC considers that it is more of a commodity since its release in 2014.
On the other hand, exchanges registered with the CFTC don’t really have to deal with these confusions because they operate on a different level of the market and under completely different rules than ICOs.
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