Cryptocurrency markets add $3 Billion, as CFTC announces ‘Virtual Currencies’ as commodities
Cryptocurrency traders saw a fresh sight of an upward (green) trend on CoinMarketCap, signaling a bullish trend. The cryptocurrency markets lost $10 Billion in 2 days and held a new market capitalization of $215 Billion. But on Thursday, US Commodity Futures and Trading Commision (CFTC) announced that ‘Virtual Currencies’ would be treated as commodities, and would come under laws related to commodity trading.
This news propelled the market forward, adding $3 Billion within 24 hours. Currently, the cryptocurrency markets are at $218+ billion dollars. On Wednesday, CFTC tweeted,
— CFTC (@CFTC) October 3, 2018
According to Investopedia, a commodity is a basic good used in commerce that is interchangeable with other commodities of the same type. They are often used as inputs in the production of other goods or services. Price of a commodity is based on speculation of future value. Cryptocurrency fits in all the above points.
By this, cryptocurrency comes under the US CFTC protection. People who have been victims of cryptocurrency scams can file an appeal to the US CFTC who would then take legal action against the scammers. This decision by CFTC brings cryptocurrencies one step closer to formal regulations.
Unfortunately, CFTC does not work with SEC. That means, the decision to approve Bitcoin ETF’s still lies with the SEC. Commodity ETFs are one of the most popular means of investment. The new law shows a good indication towards Bitcoin ETFs approval.
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