CFTC Commissioner Brian Quintenz Talks Virtual Currency Legal Updates at YahooAMS
During Yahoo! Finance’s All Market Summit, an all-day event that broke down the layers of cryptocurrencies and addressed every possible concern and benefit, the Commissioner of the Commodity Futures Trading Commission (CFTC), Brian Quintenz, tried to differentiate terms surrounding digital assets like actual delivery and something under one’s possession.
According to Quintenz, the ‘Commodity Exchange Act’ gives them more control over retail transactions. Namely, such transactions can include anything having to do with the sale of a good on the seller’s standpoint.
Based on the claims made, the CFTC will be considering such transactions as a ‘futures transaction’, a contract that compels buyers to purchase something or sellers to make a sale – necessitating sellers to become a futures broker (FCM).
He goes on to trying to explain the reason behind this concept along with its significance. Here is as per his quotes:
“Like anything else, there is an exception to it and the exception is that if actual delivery occurs within 28 days, then it is not a futures contract, it’s actually a sale. […] so, the challenge then is, well, how do we define delivery of virtual currency, of a digital commodity.”
He also added, “[…] there are warehouse receipts that are issued in terms of assigning independent possession and control and that’s the standard that the agency is really used to test whether delivery has occurred.”
While the proposed guide aims to explore different terms that can help to better understand how each transaction should be classified, it is still a fairly new step taken. Quintenz states that, “it is a very important concept for us to get right.” He also added that the efforts in place will not only work towards protecting retail investors, but also a way ensuring them that they will get what they purchased.