News & Analysis as of September 19, 2024

Virtual Currency › Commodity Exchange Act (CEA)

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Virtual Currency (aka Digital Currency or Digital Money) is a type of currency or medium of exchange that is not issued by any government nor guaranteed by a government currency. Despite lacking legal tender status, Virtual Currency is still traded and exchanged in some environments, typically online environments or communities. Bitcoin is the most well-known form of Virtual Currency. less -

Proskauer's Hedge Start: When Is CFTC Registration Necessary?

Proskauer Rose LLP on 5/7/2024

An initial question faced by a new hedge fund manager is whether or not registration with the U.S. Commodity Futures Trading Commission (CFTC) will be required. Limited Trading Exemption - CFTC Rule 4.13(a)(3), which...more

Crypto Fraud Remains Focus of CFTC Whistleblower Program

Kohn, Kohn & Colapinto LLP on 11/2/2023

For the second straight year, the majority of whistleblower tips received by the Commodity Futures Trading Commission (CFTC) Whistleblower Program were related to cryptocurrency fraud. On October 31, the CFTC released its...more

First Attempt to Regulate Spot Digital Asset Activities

Cadwalader, Wickersham & Taft LLP on 4/6/2023

On March 29, the National Futures Association (“NFA”) promulgated Compliance Rule 2-51, setting forth Requirements for Members and Associates Engaged in Activities Involving Digital Asset Commodities, which includes both...more

CFTC Settles Claims Against Founders of a Decentralized Protocol and Sues Its Successor DAO and Its Members, Pressing a Novel...

Skadden, Arps, Slate, Meagher & Flom LLP on 10/7/2022

On September 22, 2022, the Commodity Futures Trading Commission (CFTC or Commission) (1) issued an order settling charges against protocol creator bZeroX, LLC and its founders, and (2) filed a federal civil enforcement action...more

Exercise of Governance Tokens Could Result in Personal Liability for Illegal Activities of DeFi Protocol

Katten Muchin Rosenman LLP on 9/26/2022

Two natural persons who voted governance tokens issued by a decentralized finance (DeFi) protocol were charged with being “personally liable” for alleged violations of the Commodity Exchange Act (CEA) and regulations of the...more

House Introduces Bill for CFTC Spot Market Oversight

Troutman Pepper on 6/22/2022

On April 28, bipartisan lawmakers in the U.S. House of Representatives introduced legislation, allowing the Commodity Futures Trading Commission (CFTC) to oversee cryptocurrency spot markets. The legislation intends to create...more

Virtual Currency Legal Report: Week of January 7, 2022

Perkins Coie on 1/13/2022

U.S. Congress to Hold Oversight Hearing on the Mining of Cryptocurrency - NY DFS to Hire New Deputy Superintendent - Recent Federal Regulator Announcements Signal Changes in Senior Leadership at the SEC, CFTC, and FDIC...more

Whistleblowers Key to Combating Cryptocurrency Fraud

Kohn, Kohn & Colapinto LLP on 12/9/2021

In September 2021, the market capitalization for digital assets, such as cryptocurrencies and NFTs, was valued at $2.14 trillion. The cryptocurrency market has attracted a variety of fraudulent activities in which the...more

Ninth Circuit Holds that Purchasers of Unregistered Shares in Slack’s Direct Listing May Bring Securities Act Claims

Goodwin on 11/18/2021

Ninth Circuit Holds that Purchasers of Unregistered Shares in Slack’s Direct Listing May Bring Securities Act Claims; Small Class of Crypto Purchasers Recommended for Certification; Tether to Pay $41 Million to Settle...more

CFTC: Virtual Currency Creates Real Segregation Risks

Orrick - On the Chain on 10/28/2020

Virtual currency presents risks to futures commission merchants (FCMs) when deposited by futures customers or cleared swaps customers to margin futures, options on futures, or cleared swap transactions, according to an...more

CFTC Sets the Parameters for Which Virtual Currencies are Subject to Full CFTC Jurisdiction by Merit of How They are Bought and...

Dechert LLP on 8/11/2020

The Commodity Futures Trading Commission published in the Federal Register on June 24, 2020 its final interpretive guidance concerning retail commodity transactions involving certain digital assets (2020 Guidance).1 The 2020...more

Gold Is The New Bitcoin

Goodwin on 8/11/2020

In 2020, the price of gold has jumped over 30 percent from $1,517 per ounce on January 3, 2020 to over $2,000 per ounce on August 6, 2020. The spike in the price of gold isn’t yet at the level reached in the 2017 Bitcoin boom...more

What the CFTC Interpretation of “Actual Delivery” Means for Crypto

Latham & Watkins LLP on 7/27/2020

The long-awaited guidance clarifies the application of the “actual delivery” exception to leveraged virtual currency transactions with retail purchasers. Earlier this year, the US Commodity Futures Trading Commission...more

Legal Implications of Secondary SAFT Sales

Pillsbury Winthrop Shaw Pittman LLP on 7/7/2020

Simple Agreements for Future Tokens pose difficult and controversial legal questions under U.S. securities, commodities and tax laws. SAFT holders face significant difficulties in securing liquidity, and regulatory issues...more

CFTC Final Guidance on “Actual Delivery” CEA Exemption for Cryptocurrency

Burr & Forman on 6/26/2020

The Commodity Futures Trading Commission’s (“CFTC”) Final Interpretive Guidance on the “actual delivery” exception to regulatory jurisdiction for digital assets became effective June 24, 2020. See 85 Fed. Reg. 37734. The...more

CFTC Finalizes Guidance on Digital Assets in the Context of Retail Commodity Transactions

Perkins Coie on 5/1/2020

On March 24, 2020, the U.S. Commodity Futures Trading Commission (the Commission or the CFTC) finalized long-awaited interpretive guidance regarding what constitutes the “actual delivery” of a digital asset in the context of...more

CFTC Releases FY 2019 Annual Report

Proskauer - Whistleblower Defense on 12/20/2019

The Commodity Futures Trading Commission (“CFTC”) recently released its statutorily mandated 2019 Annual Report covering the fiscal year ending on September 30, 2019. The report, prepared by the CFTC’s Whistleblower Office...more

Blockchain Week in Review - October 2019

Perkins Coie on 10/18/2019

U.S. Developments - U.S. Federal Regulatory Developments - CFTC, FinCEN, and SEC Leaders Release a Join Statement on Digital Assets - On October 11, 2019, the heads of the Commodity Futures Trading Commission (“CFTC”),...more

CFTC Chairman States Ether is a Commodity

Proskauer - Blockchain and the Law on 10/14/2019

In remarks made at the Yahoo! All Markets Summit in New York, Heath Tarbert, Chairman of the U.S. Commodity Futures Trading Commission (CFTC), said that he believed the Ether cryptocurrency was a “commodity” and should be...more

When Does “Actual Delivery” of a Purchased Cryptocurrency Occur? U.S. Ninth Circuit Court of Appeals Sheds Some Light

K&L Gates LLP on 8/8/2019

Back in 2018, four different courts in the U.S. held that cryptocurrencies were commodities. This did not cause a huge ripple in the cryptocurrency community because the Commodity Exchange Act does not apply to retail...more

Bridging the Weeks - July 2019 #5

Katten Muchin Rosenman LLP on 7/30/2019

A federal appellate court in California issued a decision effectively ratifying the Commodity Futures Trading Commission’s expansive view of its authority to bring enforcement actions addressing a diverse range of purported...more

Blockchain Week in Review - May 2019

Perkins Coie on 5/16/2019

U.S. Developments - Regulatory Updates - CFTC Publishes Enforcement Manual - On May 8, 2019, the U.S. Commodity Futures Trading Commission’s (“CFTC”) Division of Enforcement (“DOE”) published its first public...more

Bridging the Week - April 2019 #4

Katten Muchin Rosenman LLP on 4/30/2019

New York regulators continued an aggressive approach against certain entities engaged in virtual currency businesses when the state's Attorney General’s office obtained an ex parte order precluding companies associated with a...more

Smart Contracts That Violate the Commodity Exchange Act: What Parties Are Liable?

Orrick, Herrington & Sutcliffe LLP on 2/28/2019

In recent years, the U.S. Commodity Futures Trading Commission (CFTC) has devoted significant resources to addressing how the requirements of the Commodity Exchange Act (CEA) and the regulations thereunder apply to...more

Blockchain Attacks and the Fight for Immutability

Perkins Coie on 2/22/2019

The Ethereum Classic blockchain was the victim of a 51% attack (often called a majority or Sybil attack) on January 5, 2019 that reorganized portions of the blockchain and allowed the attackers to double-spend 219,500 ETC...more

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Virtual Currency › Commodity Exchange Act (CEA)

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