U.S. agency's virtual currency oversight faces court challenge

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BOSTON (Reuters) – An obscure virtual currency called My Big Coin is now at the center of a closely watched case that could determine whether the U.S. Commodity Futures Trading Commission has the authority to combat fraud associated with cryptocurrencies.

FILE PHOTO: Cryptocurrency miners are seen on racks at the HydroMiner cryptocurrency farming operation near Waidhofen an der Ybbs, Austria, April 25, 2018. REUTERS/Leonhard Foeger/File Photo

Amid a crackdown on virtual currency scams, the U.S. regulator in January sued technology entrepreneur Randall Crater and a company he founded, alleging they perpetrated a $6 million fraud on people who wanted to buy My Big Coin.

Lawyers not involved in the lawsuit say that Crater’s case raises a novel challenge to CFTC oversight of cryptocurrencies, which are not backed by any central bank.

His lawyers argue the CFTC has no authority over the virtual currency because it is not a commodity like wheat or cotton or a service that is…



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