Regulators Plan To Meet on Cryptocurrencies, Seek To Define Whether Commodity Or Securitybr>
Ethereum is under increased scrutiny by US commodities and securities regulators, who are exploring whether it and other cryptocurrencies should be considered securities.
The Wall Street Journal reported today that the Securities and Exchange Commission and officials from the Commodities Futures Trading Commission (CFTC) are meeting soon to iron out their definitions. The CFTC has labeled cryptocurencies as commodities, while the SEC has stated repeatedly that they consider them securities.
Which definition prevails will play a large role in determining the growth and future of cryptocurrencies. If regulators determine cryptocurrencies are securities, it could throw the nascent markets into chaos and raise questions of whether all sales up to this point are invalid. Such a decision would place every aspect of the cryptocurrency industry into question, from exchanges to wallets to initial coin offerings (ICOs) to the companies that raised money through such means.
Ether’s cryptocurrency’s creation in 2014 was “probably an illegal securities sale” the Journal story said, citing sources familiar with the regulators’ thinking.
The cryptocurrency markets are down today, continuing a pullback that started yesterday.