U.S. CFTC Commissioner Caroline Pham pointed out that the CFTC’s recent accusations against KuCoin may interfere with its partner institutions. The CFTC and the U.S. Department of Justice charged KuCoin on March 26, 2024, with operating a crypto-asset derivatives platform without proper authorization.
The regulator's complaint appears to argue that "shares of an investor's holdings of funds - i.e. securities - may themselves constitute leveraged transactions" under applicable commodities laws, Pham said in an official statement released on Friday.
But Pham argued that this particular interpretation "fails to distinguish between investments in a fund (generally securities subject to the SEC's jurisdiction) and the fund's trading activities (here purportedly securities subject to the CFTC's jurisdiction)."
She added that the CFTC's approach could "infringe on the SEC's authority and undermine decades of strong investor protection laws because it conflates a financial instrument with a financial activity and undermines the foundation of securities markets." She also noted that "holding fund shares is not the same as trading derivatives." (Crowdfund Insider)
Earlier news, the U.S. CFTC stated on Tuesday in a legal complaint against Kucoin operators that Bitcoin, Ethereum and Litecoin are commodities.