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Sep 18, 2015

CFTC Declares That Bitcoin is a Commodity

Featuring David Grumer, Joseph Puglisi

On September 17, 2015, The U.S. Commodity Futures Trading Commission (“CFTC”) issued an Order filing and simultaneously settling charges against Coinflip, Inc. d/b/a Derivabit (Coinflip) and its chief executive officer for conducting activity related to commodity options transactions without complying with the Commodity Exchange Act (CEA) and CFTC Regulations.  

The Order finds that, from in or about March 2014 to at least August 2014, Coinflip and Riordan operated an online facility named Derivabit, offering to connect buyers and sellers of Bitcoin option contracts.  In the Order, the CFTC for the first time finds that Bitcoin and other virtual currencies are properly defined as commodities.

Aitan Goelman, the CFTC’s Director of Enforcement, commented: “While there is a lot of excitement surrounding Bitcoin and other virtual currencies, innovation does not excuse those acting in this space from following the same rules applicable to all participants in the commodity derivatives markets..” 

The CFTC’s announcement is available at : http://www.cftc.gov/PressRoom/PressReleases/pr7231-15

Contact Dave Grumer or Joseph Puglisi for more information