Senator Kirsten Gillibrand – co-author of the landmark crypto regulation bill revealed yesterday – claims that both the SEC and CFTC chairmen agree on the status of bitcoin and ether as commodities. However, both he and Senator Cynthia Loomis also agree that most other cryptocurrencies are securities.
ethereum in the clear
Senators Gillibrand and Loomis discuss their bill with the Washington Post Live on Thursday. They broke down their criteria to define a digital asset as a commodity, security, or newly introduced “ancillary asset”.
As Lumis explained, subsidiary assets can include non-fungible tokens, or digital assets that are not either stores of value or means of payment.
Securities, on the other hand, would be defined using the criteria established by the Howe Test in the 1930s and with specifications. Tokens considered securities may include those that confer “voting rights,” “dividend payments,” or “profit/revenue sharing” on their holders, among other things.
Gillibrand said his bill would empower both the SEC and the CFTC to regulate the crypto market. While the SEC will be responsible for overseeing most crypto, the “lion’s share” of the crypto market will fall under the CFTC, including Bitcoin and Ethereum.
“If you are like bitcoin, and are creating a proof of work or proof of type token, you may well be a commodity,” Gillibrand explained.
The senators clarified that although Chairman Gensler has not yet read his bill, he and the CFTC chairman both agree on their bitcoin and ethereum classifications.
“Bitcoin and Ether will certainly be commodities – and this has been agreed upon by Chairman Gensler as well as the Chairman of the CFTC.”
This revelation may come as a surprise given Gary Gensler’s hesitation to explain the status of the ether as a commodity in the past. In fact, while teaching a blockchain-focused course in 2018, Gensler Told that he thought the ether had passed the Howe test when it was first launched.
to address bias
Loomis was also asked about the political divide that currently affects bitcoin. In fact, the progressive branch of the Senate, which includes members of the Senate Banking Committee such as Elizabeth Warren and Sherrod Brown, is among the most skeptical about assets and industry.
Meanwhile, the three senators who personally own bitcoin — Pat Tomei, Cynthia Loomis and Ted Cruz — are all Republicans.
The same pattern has emerged within the SEC itself. Democrat members such as Chairman Gensler often lean toward more cautious market protection, while Republican “crypto mom” Hester Pierce wants to approve the Bitcoin Spot ETF.
As a Democrat, Kirsten Gillibrand argued that progressives can find more love in crypto by recognizing their potential to democratize financial access. She also claims that cryptocurrency can support immigrant communities by allowing for instant and cheap remittance payments.
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