The chair of the U.S. Commodity Futures Trading Commission (CFTC) has said that bitcoin has elements of all the different asset classes.
Speaking to CNBC’s ‘Fast Money‘ yesterday from the annual Milken Conference in Los Angeles, Christopher Giancarlo, the chair of the CFTC, said that:
Bitcoin and a lot of its other virtual currency counterparts really have elements of all of the different asset classes, whether they’re meeting payment, whether it’s a long-term asset.
He went on to say that even though the market is subject to regulation, depending on the regulatory regime ‘it has different aspects of all of that.’ He also said that bitcoin has similar characteristics to gold, the difference being that the cryptocurrency is digital.
Even though the number one cryptocurrency has only been around for nearly 10 years it has seen a lot of interest. So much so, that heightened interest in the currency saw it rising to within touching distance of $20,000 last December. Since then, however, bitcoin has dropped in value amid increasing pressure to regulate the market and mass selloffs. The first three months of the year have proven to be the worst for bitcoin when its value fell down to $6,000.
Since then it has rallied in value, and at the time of publishing, bitcoin is trading at over $9,000, according to CoinMarketCap.
According to Giancarlo, he believes that the cryptocurrency is better when it’s bought and held over the long-term rather than it being used as a payment option. He also mentioned that unlike bitcoin’s relative newness on the market, the CFTC and the U.S. Securities and Exchange Commission (SEC) operate under rules and regulations that were established in the 1930s.
While the cryptocurrency market has some way to go yet it is certainly becoming more mainstream. Last week, it was reported that the CEO of Nasdaq said that the stock exchange would be open to becoming a cryptocurrency exchange once the issue of regulation was tackled. Not only that, but one in five finance firms is thinking about trading digital currencies in the next 12 months.
At the end of the day, it’s for Congress, and not regulators, to decide whether new policies should be evolved for these new asset classes.
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