A group of cryptocurrency exchange platforms operating across the United States created the Virtual Merchandise Association (VCA), with the objective of achieving self-regulation of the cryptocurrencies market in the country, as a consequence of the pressure exerted by regulatory bodies such as the CFTC and the SEC.
Virtual Merchandise Association (VCA) has the primary objective to prevent fraud and manipulation in the cryptocurrencies market
An inaugural meeting of the Association is scheduled for September, bringing together some of the important cryptocurrency exchange platforms in the US, including bitFlyer, Bittrex, Gemini, and Bitstamp. The latter is a company that currently operates in Europe and could enter the North American market through this association.
According to the official press release, the VCA will work with the United States Commodity Futures Trading Commission (CFTC) which, in June, announced that it would launch an investigation on cryptocurrency exchange companies, including Bitstamp, for possible market manipulation.
In this regard, the establishment of the VCA could respond to the growing governmental pressure on crypto trading companies and controversy surrounding the regulation of digital assets.
The VCA will seek to create a self-regulatory organization (SRO) to monitor the performance of the cryptocurrencies market to develop industry standards and promote transparency in the cryptocurrencies market.
Cryptocurrencies are considered commodities across the US, hence the VCA’s intention to operate in this country
Depending on the legislation of each country in part, specific crypto coins may or may not be considered commodities. It is usual that the main cryptos, such as Bitcoin (BTC) and Ethereum (ETH), to be considered merchandise. In other cases, some crypto tokens are deemed financial securities, because they promise a future profit.
After a long controversy to determine under what type of traditional assets cryptocurrencies should be classified and what kind of regulations should be applied across the US, in October 2017, the CTFC recognized cryptocurrencies as commodities, hence the VCA’s intention to operate in the United States.
To date, there is no global agreement on the matter, so the Virtual Merchandise Association (VCA) initiative would only apply in cases where cryptocurrencies are considered commodities.