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A current improvement highlights the continued interagency drama between the US Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC): the classification of main cryptocurrencies has change into a focus of rivalry. 

Once once more, the CFTC has affirmed its place that Ethereum (ETH) and several other different cryptocurrencies must be categorized as commodities, intensifying the battle for regulatory oversight within the expansive digital belongings business.

Regulatory Rift With SEC Over Bitcoin, Ethereum, And Litecoin Classification

The newest episode on this regulatory feud unfolded with the CFTC submitting a complaint towards the crypto change KuCoin, coinciding with the unsealing of an indictment by the US Department of Justice (DOJ) towards KuCoin and its founders, Chun Gan and Ke Tang. 

The CFTC’s grievance alleged that KuCoin engaged in unlawful off-exchange commodity futures transactions and leveraged, margined, or financed retail commodity transactions. 

Furthermore, the change was accused of working with out the mandatory registrations, failing to oversee its actions diligently, and neglecting to implement an efficient buyer identification program.

However, probably the most striking aspect of the grievance lies within the CFTC’s assertion that KuCoin facilitated buying and selling involving digital belongings resembling Bitcoin (BTC), Ethereum (ETH), and Litecoin (LTC), recognizing them as commodities. 

This starkly contrasts with the SEC’s present stance, championed by Chair Gary Gensler, which suggests that solely Bitcoin holds the commodity classification, leaving different cryptocurrencies exterior this designation, together with Ethereum.

This ongoing turf battle over cryptocurrency classification has a historical past, as evidenced by the CFTC’s earlier lawsuit towards Binance final 12 months, the place Ethereum and Litecoin have been additionally deemed commodities. 

Legal Experts Suggest Turf War Over Crypto Jurisdiction

The discrepancies between the 2 regulatory our bodies have sparked debate inside the business, with authorized specialists resembling Jake Chervinsky, Chief Legal Officer at enterprise capital agency Variant, decoding the CFTC’s place as a problem to the SEC’s authority. 

Chervinsky suggests that the CFTC’s message to the SEC is that quite a few digital belongings must be considered commodities, indicating that the cryptocurrency house is inside the jurisdiction of each businesses, even when the CFTC’s strategy is much less vocal. Chervinsky’s assertion additional reads:

Usually, the SEC and CFTC fake they aren’t in a turf battle over crypto. Today the CFTC is overtly attacking the SEC’s supposed investigation of ETH. This could seem minor, however is definitely fairly savage interagency drama by DC requirements… I learn it as CFTC saying to SEC ~ a ton of different digital belongings are commodities too and also you’re not the one one who will get to guage them; this house belongs to us simply as a lot as you, even when we aren’t as loud about it.

As the CFTC and SEC conflict intensifies, the business awaits additional developments and official rulings that may form the regulatory panorama for cryptocurrencies and their respective classifications.

At the time of writing, the worth of ETH stands at $3,543, experiencing a slight 0.6% decline prior to now 24 hours. This follows a notable 5% rebound over the previous seven days.

Featured picture from Shutterstock, chart from TradingView.com