Erratic Bitcoin trading but still within the narrow USD 200 range was the play of Saturday and there seems to be very little to suggest that things will change for the world’s most traded digital asset.
In fact, there is barely USD 130 between the high and low of the past 24 hours, and Bitcoin price is now more or less steady at USD 8,345, down by 0.22% from yesterday at 10:30 am London time (CoinDesk).
Alts are having mixed fortunes, with about half of the coins in the Top 20 registering modest gains while the other half are slipping, but only slightly. The standout performers are Bitcoin SV (4.72%) and Bitcoin Gold (4.49%), while the standout losers are Lisk (-4.06%) and Monero (-1.5%).
Last year, Bitcoin and Ethereum had been determined by regulators in the US to be clearly decentralized and, as such, made them both impossible to be classified as securities. And now, fresh news is coming out from another market regulator that suggests Ethereum could now be classified as a commodity, qualifying it for regulations under the jurisdiction of the Commodity Exchange Act (CEA).
US Commodity Futures Trading Commission (CFTC) Chairman Heath Tarbert had made these remarks in yesterday’s Yahoo! All Markets Summit in New York. This was made following a request for public comment from the agency in December 2018, to help it better understand the technology and markets for cryptocurrencies other than Bitcoin. In particular, Ethereum and its Ether crypto were the focus of this request.
Previous court proceedings regarding virtual currency offerings — the vehicle by which Ether was initially created — had brought up this issue of Ether being a commodity, and some courts had found quite unequivocally that virtual currencies at issue were commodities and, therefore, subject to CFTC jurisdiction.
But Tarbert’s statement is significant since it specifically names Ether’s characterization and puts it in rather certain terms. The CFTC Chairman said:
“A commodity has a very broad definition. […] We’ve been very clear on Bitcoin. Bitcoin is a commodity under the CEA. We haven’t said anything about Ether… until now. It is my view as Chairman of the CFTC that Ether is a commodity and therefore it will be regulated under the CEA. And my guess is that you will see in the near future Ether-related futures contracts and other derivatives potentially traded.”
While his remarks will not be considered as officially binding as a regulatory matter, it will be important to use them as a guideline for how the US regulatory environment is evolving.
Speaking of regulatory environment regarding crypto, Libra is getting quite a few final nails being hammered into its seemingly narrow coffin. CBC Canada reports that credit card issuers Visa and Mastercard have now joined the list of big finance names who are pulling out of Facebook‘s cryptocurrency project.
While the earlier news of Paypal abandoning Libra could still have been poor news that Facebook would recover from, the lack of debit card partners means that this could be the death blow that puts Libra dead in the water.
They announced on Friday their departure and makes it now at least five large money companies stepping away from the Libra spotlight, including Stripe and eBay. It is thought that these companies have now gotten cold feet after Libra had to face down harsh criticism from US regulators over its plans to create a private currency system that would allow users to make cross-border payments.
The main issue with US regulators was that they were not satisfied at all that Libra Association, based in Switzerland, would be able to give Facebook or the US enough jurisdictional oversight since Facebook also wouldn’t own Libra. They also raised privacy issues, given that the sullied social networking company would not control a currency, and could not allay concerns on potential money laundering.
Publicly, even US President Donald Trump Tweeted that Libra should mean that Facebook should be subject to US banking laws.
Bearish sentiment for private crypto, but this should spell out good news for believers in decentralization, as assets and networks like Bitcoin would be impervious to such risks by the likes of Facebook.
For now, however, we pay attention to the Bitcoin and crypto markets. Sunday trading beckons now for the rest of Europe and in a few hours, we could have a better clue to how the weekend will pan out before North America takes over and sets the tone for a new week tomorrow.
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