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CFTC Chairman Tarbert announces resignation, confirms that Ether is a commodity

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In a public statement on Thursday, Chairman Heath Tarbert announced that he will be leaving the Commodity Futures Trading Commission early next year. 

In listing accomplishments over the course of his term, Tarbert included that “We have promoted responsible fintech innovation and declared Ether a commodity.”

This tracks with Tarbert’s broader interest in the crypto markets and earlier statements affirming that Bitcoin (BTC) and Ether (ETH) should not face regulation as securities.

Tarbert, who joined the CFTC in 2019, has been a noted voice for sound crypto regulation at the federal level. He joins a laundry list of appointed regulators who are leaving their posts to make way for a new administration. Tarbert’s colleague, Commissioner Brian Quintenz, is also poised to depart soon.

There is no word yet on President-elect Joe Biden’s preferences for leadership at the CFTC or the related Securities and Exchange Commission, though he has made Tarbert’s predecessor, Gary Gensler, a leader of his financial team. 



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Regulation

New York authorizes first Yen stablecoin operator in the US

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New York has given the first authorization to a stablecoin backed by the Japanese Yen to operate in the U.S.

Per a Dec. 29 announcement, the New York Department of Financial Services has granted Japanese firm GMO-Z.com a charter to handle U.S.D. and Yen-backed stablecoins in New York. 

Given New York’s status as a global center, the NYDFS is the most prominent state financial regulator in the U.S. It is also one of the most aggressive. A pass to operate in New York often opens up the rest of the country. 

GMO’s charter is as a limited liability trust company rather than a full bank, the principle difference being in authorization to handle deposits. While a stablecoin operator typically needs the ability to hold reserves of the pegged asset, GMO’s charter limits its rights to hold other kinds of deposits not central to its ability “to issue, administer, and redeem” its stablecoins. 

The right to issue such non-depository charters has been a bone of contention between state regulators like the NYDFS and national banking regulators in the U.S. 

GMO president and CEO Ken Nakamura said: “We’re breaking ground with our move to issue the first regulated JPY-pegged stablecoin, which many see as a safe haven asset.” 

The NYDFS recently made changes to its famous BitLicense, including a conditional format that buddies up newly licensed firms with existing licensees. The first conditional BitLicense went to PayPal, facilitating the launch of its new crypto services earlier this fall with the help of longstanding licensee Paxos.