Ethereum can be both a security and a commodity, says former commissioner CFTC Dan Berkowitz.
The ex-head of the department added that the second largest cryptocurrency by capitalization falls under the jurisdiction of both departments – SEC and CFTC.
“The law is clear. In fact, something can be both a commodity and a security,” he explained.
Berkowitz explained that the confusion in the definitions comes from the fact that commodities are not strictly physical objects like “wheat” or “oats”. At the same time, everything that falls under the “future contract” can technically be defined as a commodity.
The security, according to the official definition, includes bills and investment contracts, falling under the jurisdiction of the CFTC, the former commissioner added.
“This is a rather strange question: “Is this digital asset a security or not?”. I think you should be asking, “Is it being sold as part of a securities deal?” It depends on the facts and circumstances,” says Berkowitz.
In October 2022, the head of the CFTC, Rostyn Benham, warned participants in the crypto industry about the inevitability of regulation.
Earlier, the chairman of the US Securities and Exchange Commission, Gary Gensler, repeatedly stated that most cryptocurrencies are securities.
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