Bitcoins are a Commodity in CFTC Enforcement Action

CFTC Whistleblower attorneys Philadelphia

In the CFTC’s recent enforcement action against Coinflip, the regulator has defined cryptocurrencies as a commodity regulated by the Commodity Futures Trading Commission under the Commodity Exchange Act. As a result, the company’s operation of a bitcoin options trading platform was happening without the appropriate registration and compliance with regulations.

It is the first action of its kind to be brought and settled. In the future, the manipulation of futures and options related to a cryptocurrency will fall within the purview of the CFTC. More actions to handle unregulated option platforms for trading bitcoings are expected to be brought.

The CFTC indicated it will hold digital currency companies to the same standards others are held to by the agency. It also ended speculation about whether bitcoins were regulated by the CFTC. CFTC chairman Timothy Massad previously indicated that bitcoins would be considered a commodity.

This settlement paves the way for bitcoin whistleblowers to provide information about misconduct involving investments speculating on the price of bitcoins to fall within the Dodd-Frank whistleblower program established by the CFTC. If the information provided results in a monetary sanction of more than $1 million, eligible whistleblowers may receive a reward of 10 to 30 percent of the amount the government recovers.

Our CFTC whistleblower attorneys can assist you with answers to questions about this information as well as assistance reporting violations of the Commodity Exchange Act to the U.S. Government. To speak to an attorney, fill out our contact form or call 1-800-590-4116.

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