On October 17, 2017, the Commodity Futures Trading Commission’s LabCFTC released “A CFTC Primer on Virtual Currencies.” The Primer provides an overview or virtual currencies and their potential uses, discusses the role of CFTC in virtual currencies and the scope of its jurisdiction, and notes the risks associated with virtual currencies. However, the Primer does not offer insight on the breadth of the definition of “virtual currency” or which blockchain tokens may be subject to CFTC jurisdiction.
On October 17, 2017, the Commodity Futures Trading Commission’s LabCFTC recently released “A CFTC Primer on Virtual Currencies” (the Primer). LabCFTC was launched by the CFTC in May 2017, as the “focal point for the CFTC’s efforts to promote responsible FinTech innovation and fair competition.” LabCFTC was “designed to make the CFTC more accessible to FinTech innovators … to inform the Commission's understanding of new technologies… [and as] an information source for the Commission and the CFTC staff on responsible innovation that may influence policy development.” It is notable that LabCFTC’s first publication, in PowerPoint format, addresses virtual currency and related issues; however, the first publication states that the Primer “is not intended to describe the official policy or position of the CFTC, or to limit the CFTC’s current or future positions or actions.”
The Primer represents another regulator contribution to the world of blockchain tokens. For blockchain projects that create tokens, we reiterate our often expressed view that the features and functions of the platform and the tokens must be analyzed carefully when determining which regulatory regime(s) apply. In other words, the context determines the regulation.
Finally, (and most importantly) don’t commit fraud.