Although the regulation of cryptocurrency definitions in the United States is not completely clear, policymakers are becoming more sophisticated as they continue to solve more cases related to cryptocurrency.
According to the CFTC press release of 3 October 2018, District Judge Rya W Zobel gave the CFTC the power to prosecute My Big Coin Pay, the parent company of MyBigCoin.com, for payment of cryptocurrency, fraud and embezzlement.
CFTC sets up federal fees against digital currency operators
The CFTC has filed an indictment of My Big Coin Pay for violating many of the rules of the Commodity Exchange Act, including fraud and embezzlement. They hired Randall Crater of New York, Mark Gillespie of Michigan, and My Big Coin Pay to divert funds from their customers through their cryptocurrency transaction services.
In the Civil Actions document, the CFTC said that My Big Coin Pay is a cryptocurrency offering to sell a fraudulent cryptocurrency pool called My Big Coin. Crater encouraged retail investors to buy the currency by making misleading and untrue statements about their value, their use, their business status, and their financial support.
These statements included the idea that the MBC token was backed by gold and could be used in businesses that accept MasterCard. They also mentioned that the token was actively traded on many cryptocurrency exchanges.
When investors bought the token, they could see their accounts but could not withdraw funds or swap their chips. Affected members received $ 6 million from the cryptocurrency system and used the proceeds to purchase antiques, artwork, jewelry, luxury items, furniture, travel and entertainment services, and more.
US District Court He agreed with the CFTC, pointing out that My Big Coin was a commodity within the meaning of ECA. The court ruled that the term “product” should be broad because the broad definition of the term ensured that ECA rules could generally cover the market in full.
The case helps to consolidate the role of the CFTC in the cryptocurrency
Although cryptocurrency regulations are unclear in the United States. The My Big Coin Pay case will be useful to the government and its citizens to understand that CFTC’s fraudulent cryptocurrency companies are responsible. The MBC case is very important, as the judge in this case received the CFTC’s position in CFTC and McDonnell earlier this year in relation to the crypto currencies as merchandise.
James McDonald, Director of Compliance at the CFTC, commented on the decision and stated that “it is an important decision that the CFTC Authority confirmed to investigate frauds in virtual currency markets to combat it.
“This decision, like the decision of the McDonnell Weinstein judge in the eastern district of New York, recognizes the broad definition of a product within the meaning of the LEC, and the fact that the CFTC is entitled to continue goods fraud, including virtual coins”.
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