CFTC Clarified Buyer Cryptocurrency Delivery Definition

The U.S. Commodity Futures Trading Commission (CFTC) has unanimously approved the final guidance ondetermining the actual delivery of digital assets provided by the counterparty or trading platform.

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The regulator named two main factors that demonstrate actual delivery in «retail commodity transactions with digital currencies».

The first is the buyer, who is provided with:

• possession and control of the entire quantity of goods, regardless of whether they were purchased using leverage or any other financing mechanism;
• the ability to freely use the entire quantity of goods in trade (outside any particular place of transaction execution) no later than 28 days from the date of the transaction and after it.

The second is the seller, who:

• does not retain any legal interestthe right or control over any product purchased with leverage on borrowed funds or with other financial conditions, after 28 days from the date of transaction.

CFTC first proposed guidance ondetermining the moment at which cryptocurrency is actually transferred to the buyer in 2017. The year before, the lack of clear rules led the regulator to fine the Bitfinex exchange for $ 75,000 for alleged improper transfer of funds to users.

CFTC Chairman Heath Tarbert emphasized that forfinal guidance formulations the regulator interacted with firms and users of digital assets, LabCFTC and the Technology Advisory Committee.

«Although it is not yet clear whether the so-called«virtual currencies» trading on par with traditional currencies or even other classes of goods, it is critical that the US continues to be a leader in blockchain technology.Tarbert concluded.

Recall that in 2019 CFTC collected more than $ 1.3 billion in fines, including payments by digital currency operators.