The U.S. Commodity Futures Trading Commission defined bitcoin digital currency as a commodity which is covered under the existing law. 
The regulators revealed their approach to bitcoin charging the bitcoin operator Coinflip for unregistered trading and processing of swaps.

Later, the CFTC reached a settlement with the bitcoin start-up's CEO Francisco Riordan without him admitting or denying any charges. This is the first case brought by the U.S. derivatives regulator against a bitcoin exchange. 

“While there is a lot of excitement surrounding Bitcoin and other virtual currencies, innovation does not excuse those acting in this space from following the same rules applicable to all participants in the commodity derivatives markets,” said Aitan Goelman, the head of the CFTC’s Enforcement Division.

The CFTC order stated that Coinflip ran the online service Derivabit offering to match buyers and sellers from March 2014 till August 2014. The order required Coinflip to comply with the Commodity Exchange Act including registering a swap facility. 

At the moment the Derivabit website is not working. All the customers were issued a refund in July 2014, when the service stopped operating, Riordan said. According to him, the reason for putting the site down was low trade volume, not enough to sustain the website.

This week, the State of Florida sentenced a bitcoin trader who used to find clients through the Local Bitcoins site to serve 90 days in jail for operating as an unlicensed money transmitter. Earlier, the U.S. Securities and Exchange Commission forced Sand Hill Exchange, an experimental stock market, to cease online trading and to pay a fine of $20,000 for violating securities trading laws.


Aliona Chapel