cryptocurrency, bitcoin, ethereum, crypto
Crypto regulation stems from a few key sources:
What Are Commodities?
In everyday terms, commodities are raw materials or products. They are goods that are typically transformed into more consumable products or uses. Common examples are steel, coffee beans or pork bellies.
In the pork bellies context, Eddie Murphy gives some deep insight in Trading Places on how commodities investing works.
In legal terms, commodities are regulated under the Commodities Exchange Act of 1936 (the “CEA”). The CEA defines a commodity as:
"wheat, cotton, rice, corn, oats, barley, rye, flaxseed, grain sorghums, mill feeds, butter, eggs, Solanum tuberosum (Irish potatoes), wool, wool tops, fats and oils (including lard, tallow, cottonseed oil, peanut oil, soybean oil, and all other fats and oils), cottonseed meal, cottonseed, peanuts, soybeans, soybean meal, livestock, livestock products, and frozen concentrated orange juice, and all other goods and articles, except onions (as provided by section 13–1 of this title) and motion picture box office receipts (or any index, measure, value, or data related to such receipts), and all services, rights, and interests (except motion picture box office receipts, or any index, measure, value or data related to such receipts) in which contracts for future delivery are presently or in the future dealt in."
The most important part of that definition is that onions are not commodities. Pretty much everything else is, though.
(...the “onion” exception is almost certainly the result of lobbying. A similar classic example of lobbying effects on law is that the tax code has tax breaks for horse racing all over.)
This definition has been expanded by courts over time to include, for example, options.
In 2015, the Commodity Futures Trading Commission ("CFTC") determined that crypto counts as a commodity.
Why Does It Matter If Crypto Is A Commodity?
The effects of crypto being labeled a commodity are:
Learn about Bitcoin futures here
Learn how securities laws may apply to crypto here
Learn how money transmitter laws apply to crypto here
Learn about the history of non-government money like Bitcoin here