05-23-2023 icon

Former CFTC Chairman Says Ethereum is a Commodity and Security

By Lucy Adegbe

Former Commodity Futures Trading Commission (CFTC) commissioner Timothy Massad said in a recent interview that Ethereum can be both a security and a commodity. Massad, who served as CFTC commissioner from 2014 to 2017, said that the Ethereum network has both security and commodity-like characteristics.

“I think Ethereum is a hybrid,” Massad said. “It has some characteristics of a security, but it also has some characteristics of a commodity.”

Massad said that the security-like characteristics of Ethereum come from the fact that it is a platform for issuing and trading tokens. These tokens can represent ownership in a company or project, or they can simply be used as a medium of exchange.

The commodity-like characteristics of Ethereum come from the fact that it is a platform for decentralized applications (dApps). These dApps can be used to trade goods and services, or they can be used to provide financial services such as lending and borrowing.

Massad said that the CFTC’s approach to regulating Ethereum will be “fact-specific.” He said that the agency will look at the specific characteristics of each Ethereum token or dApp to determine whether it is a security or a commodity.

Massad’s comments come as the CFTC and the Securities and Exchange Commission (SEC) are both considering how to regulate cryptocurrencies. The SEC has said that it considers most cryptocurrencies to be securities, while the CFTC has said that it is more open to the idea of cryptocurrencies being commodities.

Massad’s comments suggest that the CFTC is willing to take a more nuanced approach to regulating cryptocurrencies. This could be good news for the cryptocurrency industry, as it could mean that more cryptocurrencies could be considered commodities, which would make them subject to less regulation.