Many overseas cryptocurrency exchanges would be happy to have U.S. traders as clients, but these days, American residents might as well have a sign around their necks reading “Danger: high voltage!” That’s been the case since Oct. 1, at least, when the United States Commodity Futures Trading Commission filed a complaint against Seychelles-registered BitMEX for soliciting U.S. residents and thus violating the Commodity Exchange Act. According to the complaint: “BitMEX has never been registered with the CFTC in any capacity and has not complied with the laws and regulations.” This poses a serious problem for the U.S. regulators that try …

The Commodity Futures Trading Commission is trying to make heads or tails of the recent explosion in decentralized finance. On Monday, the CFTC’s Technology Advisory Committee hosted a presentation called “The Growth and Regulatory Challenges of Decentralized Finance” by law professor Aaron Wright and attorney Gary DeWaal. In large part, the presentation was a briefing on the operations of decentralized platforms like Uni, which have commanded a greater share of crypto trading and headlines since this summer. Wright summarized the advantages of DeFi as potentially providing services for lower cost to a greater number of people by virtue of automating …

You could argue that the crypto industry should be crowdsourcing Blockstack’s legal expenses. Blockstack’s trailblazing work with the Securities and Exchange Commission on the initial coin offering (ICO) for its native Stacks (STX) tokens made headlines in mid-2019. On Monday, Cointelegraph reported on Blockstack’s legal analysis that said that upon the launch of its 2.0 network next month, Stacks will be sufficiently decentralized to leave the status of a security. Blockstack itself will be rebranding to Hiro Systems to further encourage the independence of Stacks tokens. To explain a complicated topic quickly, the concept of a “security” in investment is …

In a public statement on Thursday, Chairman Heath Tarbert announced that he will be leaving the Commodity Futures Trading Commission early next year. In listing accomplishments over the course of his term, Tarbert included that "We have promoted responsible fintech innovation and declared Ether a commodity." This tracks with Tarbert's broader interest in the crypto markets and earlier statements affirming that Bitcoin (BTC) and Ether (ETH) should not face regulation as securities. Tarbert, who joined the CFTC in 2019, has been a noted voice for sound crypto regulation at the federal level. He joins a laundry list of appointed regulators …

The public and private sectors should work closely together to bring about the future of money, according to a former leader of the Commodity Futures Trading Commission. Chris Giancarlo, a former CFTC chairman and initiator of a blockchain-based digital dollar project, joined the Singapore Fintech Festival 2020 to discuss the future of stablecoins and central bank digital currencies, or CBDCs. At a Tuesday panel called “Will CBDCs disrupt stablecoins?,” Giancarlo declared that the future of money depends on close government collaboration with the private sector. Addressing Iliana Oris Valiente’s question on the potential coexistence of the emerging rise of CBDCs …

Blockstack may be about to go where no token has gone before, by metamorphizing from a security to a non-security, as far as U.S. regulators are concerned. In a Monday blog post, Blockstack CEO Muneeb Ali published a legal memorandum in which the firm argues that its Stacks (STX) tokens will no longer qualify as securities once the new blockchain launches. The firm predicts that Stacks Blockchain 2.0 will be live "at the end of 2020 or the beginning of 2021." But what does the new blockchain have to do with securities law? Blockstack held its initial coin offering under …

Per a Dec. 3 announcement, the United States Securities and Exchange Commission’s fintech team will become an independent office. Initially launched in 2018 under the guidance of Bill Hinman, the SEC’s Strategic Hub for Innovation and Financial Technology, or FinHub, has been a leading force in securities regulation as it applies to new technologies since its inception. Given that the same timeframe has seen a major ramping up of the SEC’s pursuit of initial coin offerings it deemed as unregistered security sales, FinHub has been busy. The shift to an independent office means that rather than reporting to the Division …

The Commodity Futures Trading Commission, or CFTC, is having a banner year in crypto enforcement. Per the commission's annual review released on Tuesday, fiscal year 2020 featured seven monetary relief actions against firms engaged in illegal activity in crypto, which is a new record. The review said: "In conjunction with the Division’s Digital Asset Task Force, the Commission brought a record setting seven cases involving digital assets." These included charges against PanForex for offering leveraged trading to U.S. persons without registering in the United States, as well as against Digital Platinum for classic fraud. The CFTC is the U.S. federal …

With 55 days until his inauguration as President of the United States, Joe Biden is reportedly considering the former chairman of the Commodity Futures Trading Commission for a permanent position in his administration. According to a Nov. 25 report from CNBC, the president-elect is floating Gary Gensler for a position as Deputy Treasury Secretary starting in 2021. The report states that “people familiar with the matter” have mentioned Gensler as a likely candidate for the role. He would be working under former Federal Reserve Chair Janet Yellen, whom Biden is reportedly planning to nominate as Secretary of the Treasury. Yellen …

United States crypto exchange Coinbase Pro announced today that customers would not be able to use margin trading on the platform beginning on Wednesday. According to the Coinbase blog, chief legal officer Paul Grewal said that no new margin trades would be allowed starting on Nov. 25 at 2:00 PST. The exchange stated that it would take the product offline in December “once all existing margin positions have expired.” “We believe clear, common sense regulations for margin lending products are needed to protect and provide peace of mind to U.S customers,” said Grewal. “We look forward to working closely with …

A blockchain data platform has been selected the winner of the Commodity Futures Trading Commission’s first science competition, offering yet another compelling sign that distributed ledger technology has burst onto the mainstream. Nakamoto Terminal, a digital-asset analytics platform built by open-source intelligence company Inca Digital, has won the CFTC’s "Project Streetlamp" competition. Nakamoto Terminal was also named "Innovator of the Year" by the CFTC for its successful submission. The Project Streetlamp competition challenged innovators to come up with an artificial intelligence solution that could help the CFTC “automate the process of identifying and adding unregistered foreign entities” to its Registration …

Every Friday, Law Decoded delivers analysis on the week’s critical stories in the realms of policy, regulation and law. Editor's note In the United States, as President Donald Trump stonewalls any efforts at transitioning to a new administration, all eyes are on Joe Biden’s potential team and any hints as to candidates for major appointed positions. Further complicating the set up of a presidential roster is that most presidential appointments require Senate approval. The Senate, meanwhile, is waiting until January for a run-off election in Georgia to establish a majority. So, as with everything else, we in the states are …