Brian Armstrong, founder and CEO of Coinbase Ethereum argues that its asset can be classified as a commodity like Bitcoin (BTC) under US federal law.
This classification plays an important role when the U.S. Securities and Exchange Commission (SEC) evaluates applications for Ethereum exchange-traded funds (ETFs). As we reported as Koinfinans.com, the SEC previously approved Bitcoin ETFs this year, adding strength to the market.
In his interview on Bloomberg, Armstrong emphasizes that after the SEC approves Bitcoin ETFs, Ethereum ETFs should also be approved in a similar way and everyone should be treated equally before the law. However, he notes that there is still disagreement among federal agencies over whether ETH should be classified as a security or a commodity, which could complicate the application process.
Armstrong stated the following on the subject:
“Ethereum ETFs need to be openly approved and everyone needs to be treated equally under the law. Unfortunately, cryptocurrency issues have become a bit politicized among some federal agencies, and there is a tug of war between the CFTC (U.S. Commodity Futures Trading Commission) and the SEC over whether Ethereum is a commodity or a security.
While the fact that Ethereum is a commodity is pretty clear, that won’t stop some people from trying to disrupt things.”
SEC chairman Gary Gensler has not yet commented on whether ETH is a security, but he has hinted that many digital assets other than Bitcoin could be considered securities. Meanwhile, the CFTC stated that ETH is a commodity.
Armstrong says that eventually the courts may decide on this issue and they may have to follow a similar path as for Bitcoin ETFs. In August, a court found that the SEC acted “arbitrarily and capriciously” in denying Grayscale’s application to convert the Grayscale Bitcoin Trust (GBTC) into a spot ETF. Gensler stated that this decision was a critical factor in approving spot Bitcoin ETF applications.
Armstrong added:
“If it is unfairly delayed, I think the industry will have to follow the same path as for Bitcoin, which is to go to the courts and the courts will force the regulators to comply with the rules, the law and the equal application of the law. “This may require additional effort, but I think their approval should be immediate.”
