This recent Litigation Alert from Akin Gump provides an important summary of a key Federal court ruling regarding the Commodity Futures Trading Commission’s (CFTC) authority to regulate virtual currencies. But equally important, it provides a concise history of recent U.S. regulatory developments:

The CFTC, whose primary focus is the regulation of commodity trading in futures and swap markets, has in recent years asserted that its authority extends to cash and spot markets with respect to fraud or manipulation. This case is important because it holds that a) Virtual currencies meet the definition of commodities and b) The CFTC has jurisdiction in this case despite the absence of futures contracts.

The SEC has separately asserted: a) Many products marketed as cryptocurrencies function as securities, requiring registration unless exempted. b) Online platforms for trading cryptocurrencies function as securities exchanges and must be registered.

The IRS has asserted that virtual currencies are “property” and thus transactions are subject to general tax principles like other kinds of property.

Other regulatory bodies are taking steps with respect to cryptocurrencies.

As these efforts continue to evolve, they will affect the value of cryptocurrencies in general. The impact on any particular currency will, of course, depend on specific facts and circumstances.