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Litecoin deemed commodity in lawsuit against Binance by CFTC

  • The Litecoin community celebrates as CFTC classifies it as a ‘commodity’ defined under Section 1a(9) of the Act, 7 U.S.C.
  • The LTC price has witnessed strong gains ahead of halving backed by strong whale activity this month of March.

On Monday, March 27, the U.S. Commodities and Futures Trading Commission (CFTC) slapped a lawsuit on crypto exchange Binance for allegedly violating the derivatives regulations. Interestingly, the details of the lawsuit have revealed more information beyond Binance.

In its 74-page court filing, the CFTC has named three digital assets – Bitcoin (BTC), Ethereum (ETH), and Litecoin (LTC) – as commodities. There’s been quite a debate among the US regulators. especially the SEC and CFTC, over jurisdictional rights over certain cryptocurrencies and which ones qualify either as a ‘security’ or a ‘commodity’.

A recent argument broke up between the two regulators when the CFTC claimed that Ether (ETH) is a commodity. However, SEC Chair Gary Gensler believes that all PoS cryptocurrencies shall fall under their jurisdiction.

In its latest statement, CFTC Chair Rostin Behnam said that the agency would continue to regulate the volatile and insecure crypto industry. He further added that the CFTC will be responsible for the regulation of derivative products, such as the financial contracts linked to commodities. In its lawsuit against Binance, CFTC noted:

[Binance] operated a facility for the trading of futures, options, swaps, and leveraged retail commodity transactions involving digital assets that are commodities including bitcoin (BTC), ether (ETH), and litecoin (LTC) for persons in the United States.

Well, the Litecoin community also celebrated the development over the clarity on the matter. This will allow other crypto players to build their derivative products in and around Litecoin.

Litecoin halving and whale activity

Last week, the cryptocurrency Litecoin (LTC) registered a phenomenal rally moving past $90 in a strong move. Several market experts believe that the recent rally in the LTC price comes as the Litecoin halving event approaches closer.

Scheduled somewhere around August 2023, the Litecoin halving will cut the LTC mining rewards in half. The halving also makes the assets more scarce theoretically, and thus more valuable. During the previous halving events of 2019 and before, Litecoin delivered a pretty strong rally ahead of the event.

There’s a high chance that LTC could replicate its past success this time as well. the LTC price has shown volatile behavior so far in 2023. Last month in February, LTC touched a high of $103 and dropped more than 30 percent from this high. However, LTC is once again back in a strong recovery surging past $90 last week.

On the other hand, the good thing is that the Litecoin whale activity is also on the rise. Blockchain data analytics firm IntoTheBlock reported that the average size of LTC transactions has jumped by 500 percent this month of March. Earlier on March 2, the average size of LTC transactions was $13,355. This jumped to $81,022 by March 23.

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