Feeds

Watchdog: Y'know what Bitcoin really needs? A REGULATOR!

US derivatives commission mulls rules for e-cash

Boost IT visibility and business value

A US financial regulator has said it's figuring out if crypto-currency Bitcoin falls under its remit.

Top bods at the Commodity Futures Trading Commission (CFTC) are discussing whether the cyber-cash should actually be covered by its rules, as Bitcoin gains in popularity.

"[Bitcoin] is for sure something we need to explore," one of the five commissioners at the CFTC told the Financial Times.

"It’s not monopoly money we’re talking about here - real people can have real risk in these instruments, and we need to ensure that we protect markets and consumers, even in what at first blush appear to be ‘out there’ transactions," he said.

A person familiar with the commission's chats on the online currency said it was "seriously" looking into Bitcoins.

It's not the first time that governments and regulators have made noises about stepping into the Bitcoin market, which is starting to be seen as an attractive alternative to more traditional investments because the currency is not under the control of any central bank or government, as traditional currencies are.

Bitcoin transactions are also difficult for governments to levy taxes upon as the currency does not operate through traditional banking channels, relying instead upon a combination of algorithms and cryptography.

The US Treasury said in March that any firms that deal in the virtual money would be considered "money services businesses" just like any other, requiring them to provide information to the government and implement policies to stop money laundering.

The CFTC usually monitors derivatives contracts rather than cash markets, so it may not be the right body to oversee all Bitcoin transactions. Any leveraged deals that were not settled within two days would fall under the commission's jurisdiction, the source said.

"In essence, we’re talking about a type of shadow currency, and there is more than a colourable argument to be made that derivative products relating to Bitcoin fall squarely in our jurisdiction," Chilton said. ®

The Essential Guide to IT Transformation

More from The Register

next story
Just TWO climate committee MPs contradict IPCC: The two with SCIENCE degrees
'Greenhouse effect is real, but as for the rest of it ...'
Adam Afriyie MP: Smart meters are NOT so smart
Mega-costly gas 'n' 'leccy totting-up tech not worth it - Tory MP
'Blow it up': Plods pop round for chat with Commonwealth Games tweeter
You'd better not be talking about the council's housing plans
Arrr: Freetard-bothering Digital Economy Act tied up, thrown in the hold
Ministry of Fun confirms: Yes, we're busy doing nothing
Help yourself to anyone's photos FOR FREE, suggests UK.gov
Copyright law reforms will keep m'learned friends busy
Apple smacked with privacy sueball over Location Services
Class action launched on behalf of 100 million iPhone owners
UK government officially adopts Open Document Format
Microsoft insurgency fails, earns snarky remark from UK digital services head
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Backing up Big Data
Solving backup challenges and “protect everything from everywhere,” as we move into the era of big data management and the adoption of BYOD.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.