This post builds upon an idea presented in Part 4 of current series of posts on considerations for investment funds and advisers related to cryptocurrency derivatives. In particular, this post provides additional perspectives on the relationship of leverage, margin, and financing to two commodity interests: “retail commodity transactions” and a “swaps”. We decided to present … Continue Reading
This post is the fourth in a series that outlines key considerations for investment funds and their advisers regarding the application of the U.S. commodity laws to cryptocurrency derivatives. This post is intended to be a primer on the topic and is not legal advice. You should consult with your counsel regarding the application of … Continue Reading
This post is the third in a series that outlines key considerations for investment funds and their advisers regarding the application of the U.S. commodity laws to cryptocurrency derivatives. This post is intended to be a primer on the topic and is not legal advice. You should consult with your counsel regarding the application of … Continue Reading
This post is the second in a series that outlines key considerations for investment funds and their advisers regarding the application of the U.S. commodity laws to cryptocurrency derivatives. This posting is intended to be a primer on the topic and is not legal advice. You should consult with your counsel regarding the application of … Continue Reading
In this multi-part posting, we outline key considerations for investment funds and their advisers regarding the application of the U.S commodity laws to cryptocurrency derivatives. This posting is intended to be a primer on the topic and is not legal advice. You should consult with your counsel regarding the application of the U.S. commodity laws … Continue Reading
For those of you who have been following along thus far, the U.S. Securities and Exchange Commission (“SEC”) and the SEC’s Division of Trading and Markets (“SEC Staff”) have been wrestling since December 2017 with whether to approve or disapprove exchange-traded funds (“ETFs”) that invest in bitcoin futures contracts. On August 22, 2018, the SEC … Continue Reading
On July 26, 2018, the U.S. Securities and Exchange Commission (“SEC” or “Commission”) issued an order disapproving a proposed rule change that would have allowed for a bitcoin exchange-traded product (“ETP”) (the “Order”). However, the Order was not unanimous amongst the SEC’s Commissioners. Commissioner Hester M. Peirce issued a stand-alone dissent against the Order, arguing … Continue Reading
On July 26, 2018, the U.S. Securities and Exchange Commission (“SEC” or “Commission”) issued an order, by a 3-1 vote, disapproving a proposed rule change (the “Proposal”) that would have allowed for a bitcoin exchange-traded product (“ETP”) (the “Order”). In the Order, the SEC re-asserted many of its prior concerns and reasons for denying the … Continue Reading
On March 23, 2018, the U.S. Securities and Exchange Commission (“SEC”) issued an order instituting proceedings to determine whether it will approve or disapprove a proposal for Bitcoin futures exchange-traded funds (“ETFs”) (the “Order”). In December 2017, NYSE Arca, Inc. filed a rule change proposal to allow for the creation of ETFs that invest in … Continue Reading
According to recent data provided by CBOE and CME Group, the volatility and total volume of bitcoin futures in 2018 have been in a gradual decline. As displayed in the chart below, the Cboe bitcoin futures contract (XBT) volatility for the lead month declined in each month to begin 2018. In addition, according to data … Continue Reading
By Andrew P. Cross, Laurie Rosini, and Thomas Ahmadifar On December 15, 2017, the U.S. Commodity Futures Trading Commission (the “CFTC”) issued a proposed interpretation of the term “actual delivery” as used in the provision of the Commodity Exchange Act (the “CEA”) that grants the CFTC explicit authority to oversee the marketplace for “retail commodity … Continue Reading
On December 15, 2017, the U.S. Commodity Futures Trading Commission (the “CFTC”) issued a proposed interpretation of the term “actual delivery” as used in the provision of the Commodity Exchange Act (the “CEA”) that grants the CFTC explicit authority to oversee the marketplace for “retail commodity transactions”. This is the first blog posting in a multi-part series that will … Continue Reading
It was a busy morning at the intersection of derivatives and virtual currencies. Here is an overview of what happened and some thoughts about what it means for the world of virtual currencies.… Continue Reading
Earlier today, CFTC Commissioner Brian Quintenz spoke at a conference hosted by ISDA in London. His remarks focused on the central theme of that conference – the power of technology to transform financial markets. In this posting, we will provide highlights from Commissioner Quintenz’s speech, as we believe that this speech addresses several key concepts … Continue Reading
Earlier today, LabCFTC released, “A Primer on Virtual Currencies,” which it describes as being the first of a series of publications “to help market participants and innovators navigate the FinTech landscape”. The publication, which provides an overview of “virtual currencies and their potential use-cases,” is noteworthy for several reasons:… Continue Reading
On September 21st, the Commodity Futures Trading Commission (“CFTC”) announced the filing of charges against Nicholas Gelfman and Gelfman Blueprint, Inc. (the “Defendants”) for fraud, misappropriation, and issuing false account statements in connection with solicited investments in Bitcoin. According to the allegations asserted by the CFTC, the Defendants operated a Ponzi scheme, misappropriated funds from … Continue Reading
On October 18th, a cryptocurrency platform provider (Poloniex, Inc.) issued a press release announcing that it filed a request for no-action relief with the Commodity Futures Trading Commission (the “CFTC”) seeking request with respect to the CFTC’s laws as they relate to margin and lending transactions. To our knowledge, this is first time that a … Continue Reading
On October 12, 2016 the Securities and Exchange Commission (“SEC”) issued an order instituting proceedings to determine whether or not to approve or disapprove a proposed rule change filed by Bats BZX Exchange, Inc. (“Exchange”) that would permit Winklevoss Bitcoin Shares (“Shares”) issued by the Winklevoss Bitcoin Trust (“Trust”) to be listed and traded on … Continue Reading
On June 2nd, the U.S. Commodity Futures Trading Commission (the “CFTC”) announced an enforcement order and settlement with BFXNA Inc. d/b/a Bitfinex, an online platform for exchanging and trading cryptocurrencies (the “Platform”). This posting will summarize that order with the goal of helping our readers make sense of the current state of the law with respect to … Continue Reading
Financial technologies like the block chain and related distributed ledger platforms are the source of much discussion and debate in today’s legal and finance industry publications. Some commentators feel that these technologies will be completely revolutionary, while other commentators feel that “the fad” will pass. … Continue Reading
Earlier today, the U.S. Commodity Futures Trading Commission (“CFTC”) published a notice announcing that its Technology Advisory Committee (“TAC”) will hold a public meeting on January 26th to discuss issues related to blockchain and the potential application of distributed ledger technology to the derivatives market. In addition to the blockchain related issues, the TAC will … Continue Reading
On September 24th, the U.S. Commodity Futures Trading Commission (CFTC) settled charges against TeraExchange LLC, a provisionally registered bitcoin swap execution facility (SEF). The charges stem from a non-deliverable forward (“NDF”) contract based on the relative value of the U.S. Dollar and Bitcoin (the Bitcoin swap) executed over that SEF. Background: Forwards and NDFs A … Continue Reading
