If you didn't hear the first time, the CFTC has restated its authority over virtual currencies such as Bitcoin including futures and swap contracts. The claimant of this authority, Chairman of the CFTC Timothy Massad, made such comments when he appeared before the US Senate Committee on Agriculture, Nutrition and Forestry. Massad's claim relies upon the Commodity Exchange Act's broad definition of what a commodity is.
In his testimony, Massad said:
We also continue to respond to market developments such as new products. Virtual currencies, such as bitcoin, are an example. Virtual currencies may raise issues for a number of governmental agencies. The CFTC's jurisdiction with respect to virtual currencies will depend on the facts and circumstances pertaining to any particular activity in question. While the CFTC does not have policies and procedures specific to virtual currencies like bitcoin, the agency’s authority extends to futures and swaps contracts in any commodity. The CEA defines the term commodity very broadly so that in addition to traditional agricultural commodities, metals, and energy, the CFTC has oversight of derivatives contracts related to Treasury securities, interest rate indices, stock market indices, currencies, electricity, and heating degree days, to name just a few underlying products.
Derivative contracts based on a virtual currency represent one area within our responsibility. Recently, for example, a SEF registered with us made such a contract available. Innovation is a vital part of our markets, and it is something that our regulatory framework is designed to encourage. At the same time, our regulatory framework is intended to prevent manipulation and fraud, and to make sure our markets operate with transparency and integrity. Our responsibilities at the CFTC in this regard are ongoing. It is important to emphasize that the existence of contract does not mean the CFTC endorses it. As with all new developments, we must remain vigilant to ensure market integrity, and will continue to evaluate these new contracts over time. We will also continue to coordinate with other regulatory authorities regarding the issues raised by virtual currencies as appropriate.
Despite a second reminder that the CFTC has authority over Bitcoin, Massad failed to demonstrate this supposed authority before the hearing or anyone else.