Crypto News

Bitcoin Marks 8th Year of US Commodity Status

Published

1 year ago

September 18, 2023

On September 17, 2015, the U.S. Commodity Futures Trading Commission (CFTC) officially declared Bitcoin a commodity, a distinction that eight years later continues to set it apart from other cryptocurrencies that have yet to earn this status.

While regulatory uncertainty still looms over other more centralized, digital assets, the CFTC’s classification of Bitcoin as a commodity established a regulatory framework for Bitcoin, one that allows it to be treated like other classical commodities including gold and precious metals.

In its ruling, the CFTC stated that Section 1a(9) of the CEA defines commodity to include “all services, rights, and interests in which contracts for future delivery are presently or in the future dealt in.”

“The definition of a ‘commodity’ is broad… Bitcoin and other virtual currencies are encompassed in the definition and properly defined as commodities,” the agency wrote at the time.

The U.S. Securities and Exchange Commission (SEC), under the leadership of Chairman Gary Gensler, has been actively scrutinizing various digital assets to determine whether they should be classified as securities, an ongoing evaluation that has created a complex and evolving landscape for altcoins.

In recent remarks, Chairman Gensler reiterated the SEC’s commitment to maintaining a strong regulatory framework for cryptocurrencies. He emphasized that the distinction between commodities and securities depends on the specific characteristics of each digital asset.

Gensler acknowledged that while Bitcoin, due to its decentralized nature, qualifies as a commodity, other cryptocurrencies exhibit traits that might classify them as securities.

The determination hinges on factors like the degree of centralization, utility, and the presence of third-party entities. Gensler’s remarks underscore the ongoing debate within regulatory circles about how to classify cryptocurrencies effectively.

Of much debate has been the Howey Test, the regulatory standard set in the 1900s that seeks to establish when a certain investment offers the promise of a financial return from the work of others.

Crucially, Bitcoin, with its use of proof-of-work as a consensus mechanism allows anyone in the world who can generate electricity to purchase or create a mining machine, whose calculations can enable that participant to claim the new cryptocurrency that it creates.

This distinction separates Bitcoin from the ambiguity surrounding other altcoins, and continues to be a major catalyst for Bitcoin’s legitimacy and growth in the financial markets at a time when the regulatory status of other cryptocurrencies, at least in the United States, remains mired in uncertainty.

The 8th anniversary of Bitcoin’s classification as a commodity is a reminder of the progress made in this regard, even as other cryptocurrencies await definitive regulatory guidance from the SEC.

Today marks the 8th anniversary of a significant milestone in Bitcoin’s journey as a financial asset – its classification as a commodity by U.S. regulators.

Crypto News

MicroStrategy Buys Additional $489 Billion Worth of Bitcoin

Published

2 hours ago

September 20, 2024

MicroStrategy CEO Michael Saylor announced on September 20 that it has purchased an additional 7,420 bitcoins for approximately $489 million. The company now holds over 252,000 Bitcoin, acquired for $9.9 billion.

BREAKING: MicroStrategy buys another 7,420 #Bitcoin for $458.2 million. pic.twitter.com/4nBm3EUH6M

— Bitcoin Magazine (@BitcoinMagazine) September 20, 2024

Since 2020, MicroStrategy has adopted a Bitcoin-focused corporate strategy, taking advantage of Bitcoin’s potential as an inflation hedge and store of value. The company has accumulated over 252,000 bitcoins worth more than $15 billion, substantially increasing shareholder value.

MicroStrategy has borrowed money by issuing convertible senior notes to fund its Bitcoin purchases. It recently raised over $1 billion through note offerings, partly to acquire more Bitcoin. Other public companies have emulated this “buy Bitcoin” corporate strategy to take advantage of Bitcoin’s growth.

MicroStrategy’s Bitcoin treasury purchases are like a large-scale “speculative attack” against fiat currencies. By exchanging fiat for scarce bitcoin when it is undervalued, the company could reap enormous returns if bitcoin continues appreciating as a global digital store of value.

The company is undertaking the largest speculative challenge against fiat currency in history by adding the most resilient asset to its treasury. Other public companies are beginning to emulate MicroStrategy by implementing Bitcoin treasury strategies and gaining Bitcoin exposure on their balance sheets.

MicroStrategy purchased an additional $489 million of Bitcoin, swelling its corporate Bitcoin treasury to over 252,000 BTC worth nearly $10 billion. The company’s Bitcoin strategy aims to boost returns and hedge against inflation.

Crypto News

Santa Monica Bitcoin Office Case Study to be Presented at CMRTA Annual Conference

Published

2 hours ago

September 20, 2024

Proof of Workforce, joined by Santa Monica Vice Mayor Lana Negrete, will showcase the Santa Monica Bitcoin Office at the upcoming California Municipal Revenue and Tax Association (CMRTA) Annual Conference on October 9-10. They will present a case study on the innovative municipal office, the first of its kind in the U.S.

Launched in July 2024 after a unanimous city council vote, the Santa Monica Bitcoin Office aims to educate residents about Bitcoin’s potential while identifying industry partnerships to support economic recovery and job creation.

“Proof of Workforce is excited to share our experiences and insights with other municipal leaders at the CMRTA conference,” said founder Dom Bei. “Already, through our early initial work, there are many valuable lessons learned and opportunities that have emerged.”

Vice Mayor Negrete added, “We have received an overwhelming amount of interest and positive engagement as we continue to learn about Bitcoin as a community.”

The presentation will highlight challenges and opportunities in implementing the novel office. It will offer lessons for other municipalities considering similar initiatives. The CMRTA conference, which convenes municipal finance experts from across California, covers topics such as personal branding, regulatory updates, ballot measures, and emerging issues like Bitcoin.

Proof of Workforce coordinates the Bitcoin Office at no cost to Santa Monica. The non-profit provides Bitcoin education and adoption resources for workers, unions, pension funds, and cities.

Proof of Workforce and Santa Monica’s vice mayor will present a case study on the city’s innovative Bitcoin Office at the CMRTA Annual Conference. The office, the first of its kind in the U.S., aims to educate on Bitcoin and support economic recovery.

Crypto News

Satoshi Era Wallets Moved $16 Million Worth of Bitcoin

Published

7 hours ago

September 20, 2024

Around 250 BTC from the early days of Bitcoin, known as the “Satoshi era,” were transferred on Friday in five separate transactions, each moving around 50 BTC to new wallets. The total value of the transfers was close to $16 million.

The coins were originally mined in January 2009, just months after Bitcoin’s launch, and have lain dormant since. Arkham blockchain analysis shows the wallets are not linked to Bitcoin’s pseudonymous creator, Satoshi Nakamoto.

The original wallets that moved the coins are: 1CGT3Ywaa2upJfWtUtbXonDPNTfZPWqzmA, 1MBBJBFEaYKHFZAeV7hQ7DWdu3aZktjzFH, 13J8FkimCLQ2EnP1xRm7yHhpaZQa9H4p8E, 18E5d2wQdAfutcXgziHZR71izLRyjSzGSX, 1C4rE41Kox3jZbdJT9yatyh4H2fMxP8qmD

The transfers likely belonged to an early Bitcoin miner who acquired the coins when BTC was practically worthless. After holding them for over 15 years, they are now valued at $16 million.

This demonstrates the conviction of early believers who recognized Bitcoin’s potential value long before the recent meteoric price rises. The anonymous owner mined and held these coins when Bitcoin was a niche experiment, exhibiting remarkable faith.

While the original owner remains a mystery, the transfers are among one of the largest amounts of “Satoshi era” Bitcoin ever moved. There has been no activity sending the coins to exchanges, indicating the owner may intend to continue holding them.

Around 250 BTC from Bitcoin’s early days were transferred after 15 years of inactivity, revealing the huge rewards reaped by early miners. The $16 million worth of “Satoshi era” coins highlights the conviction of pioneering hodlers.