Caroline Pham, a commissioner at the U.S. Commodity Futures Trading Commission (CFTC), has criticized her agency for potentially violating the authority of the Securities and Exchange Commission (SEC) in its latest accusations against cryptocurrency exchange KuCoin.
On March 26, the CFTC, in cooperation with the US Department of Justice, accused KuCoin of illegally operating a digital asset derivatives exchange. However, Pham expressed concerns about the institution's approach in his statement today.
The CFTC's complaint appears to allege that fund shares held by investors, which are typically considered securities, could constitute leveraged trading under commodity laws, according to Pham. Pham argued that this interpretation does not distinguish between an investment in a fund that falls within the SEC's jurisdiction and the trading activities of a fund that the CFTC claims falls within its jurisdiction.
The issue of jurisdiction between the CFTC and SEC over the crypto industry has become a recurring theme over the past year. The two institutions have publicly disagreed over whether Ethereum is a security or a commodity. While SEC Chairman Gary Gensler refrained from giving a direct answer, he stated that many cryptocurrencies are securities. On the other hand, the CFTC argued that ETH is a commodity, a stance it reiterated in its accusations against KuCoin.
*This is not investment advice.
