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Federal court: Virtual currency is a commodity, in CFTC purview

Joe Mont | October 5, 2018

A federal court has ruled that the Commodity Futures Trading Commission has the power to prosecute fraud involving virtual currency.

The Sept. 26 ruling was handed down by Senior Judge Rya Zobel of the U.S. District Court for the District of Massachusetts.

“This is an important ruling that confirms the authority of the CFTC to investigate and combat fraud in the virtual currency markets,” CFTC Director of Enforcement James McDonald said in a statement. 

Agreeing with the CFTC’s arguments, the Court held that the CFTC had sufficiently alleged that the particular virtual currency at issue, My Big Coin (MBC), was a commodity under the Commodity Exchange Act.

The CFTC alleged that MBC “is a virtual currency, and it is undisputed that there is futures trading in virtual currencies (specifically involving Bitcoin).” According to the Court, the term “commodity...

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