The CFTC called Bitcoin and Ethereum commodities in a lawsuit against the KuCoin exchange

The CFTC called Bitcoin and Ethereum commodities in a lawsuit against the KuCoin exchange

The CFTC has accused KuCoin of numerous violations of the Commodity Exchanges Act and the rules of regulated activity. In the filed lawsuit, the Commission called Ethereum and other crypto assets a commodity. The media claim that the KuCoin exchange was considering the option of closing in 2023.

The U.S. Commodity and Futures Trading Commission (CFTC) has filed a lawsuit against the KuCoin cryptocurrency exchange. The agency accused the company of numerous violations of the law "On Commodity Exchanges" and the rules of operation provided for by regulatory norms.

The CFTC accuses KuCoin of failing to register, failing to provide oversight of its activities, and deliberately refusing to implement a customer identification program (CIP). In addition, the company is suspected of illegal trading in over-the-counter commodity futures and transactions with leverage.

Representatives of the CFTC are demanding compensation for damages and fines. The commission also intends to achieve a permanent ban on trading and registration for KuCoin, the statement said.

"For too long, some crypto exchanges have followed an already well-known pattern, offering derivative products and falsely claiming that US residents cannot use their platforms. In fact, any American with generally accepted technology could trade on the platform without providing basic customer identification information," said CFTC Enforcement Director Ian McGinley.

It is worth noting that in its lawsuit, the agency named bitcoin, Ethereum and Litecoin as commodities. According to some analysts, in this way the CFTC wants to win the competition from the U.S. Securities and Exchange Commission (SEC) for the right to regulate certain types of digital assets.

Two agencies have been claiming for several years to be able to oversee the crypto market. For this reason, the SEC promotes the definition of digital assets as securities, and the CFTC, in turn, insists on using the term "commodity".

In addition to the lawsuit from the U.S. Commodity and Futures Trading Commission, the KuCoin exchange faced separate criminal charges from the U.S. Attorney's office. The co-founders of the company and the company itself are suspected of facilitating money laundering, violating the law "On Bank Secrecy", deceiving investors and illegal activities.

Some media outlets claim that the company's management considered closing the company in 2023. The co-founders of KuCoin thought about this possibility after the start of investigations in the United States and China, journalists assure.


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