“Stablecoins Are Our Jurisdiction Unless Expressed By Congress”

Rostin Behnam, head of the Commodity Futures Trading Commission (CFTC), said in a statement that he views many stablecoins as securities and stated that he is against the new law that could change the classification of these coins. Speaking to the Senate Agriculture Committee on Wednesday, CFTC Chairman Rostin Behnam told reporters:

“However, these are commodities and we have to monitor this market without clear instruction from Congress that they are another type of asset. Based on the lawsuits we have filed against stablecoins, we have a strong legal framework that USDC and other similar stablecoins will be commodities unless Congress tells regulators otherwise. I think it’s an argument.”

Behnam cited a special sanction decision taken by the CFTC against stablecoin issuer Tether and its affiliated exchange BitFinex in 2021. This comment seems to prompt the CFTC and the Securities and Exchange Commission (SEC) to separate opinions on another issue related to digital assets. Last month, the SEC notified Paxos that Binance and its USD-pegged stablecoin BUSD are an unregistered security. Paxos announced that it stopped issuing BUSD tokens after receiving the SEC notification. “As far as I know, fiat-backed stablecoins do not expect profits and returns to the stablecoin holder,” Behnam said. But he made it clear that he wasn’t sure how algorithmic stablecoins could qualify.

Behnam and SEC Chairman Gary Gensler already seem to have differing views on Ethereum. Gensler implied that he views ETH as a security, along with nearly all non-Bitcoin digital assets. Behnam told reporters about Ethereum:

“We edited ETH derivatives. It is no coincidence that these futures contracts are listed on the CFTC markets. We did the analysis, the listing exchange did the legal analysis, and the analysis led to the conclusion that ETH is a commodity, and I have been pretty consistent about that in the past.”