On July 12, 2018, a federal judge of the U.S. District Court for the Eastern District of New York reaffirmed its view that cryptocurrency fraud is subject to the U.S. Commodity Futures Trading Commission’s (“CFTC’s”) anti-fraud and anti-manipulation enforcement authority. The ruling involved a federal civil enforcement action filed by the CFTC in January 2018 against Patrick McDonnell and his company, CabbageTech, Corp. d/b/a Coin Drop Markets (“CDM”), charging the defendants with fraud and misappropriation in connection with purchases and trading of the virtual currencies Bitcoin and Litecoin. The CFTC’s complaint alleges that McDonnell and CDM operated a deceptive and fraudulent virtual currency scheme to induce customers to send money and virtual currencies to CDM in exchange for purported virtual currency trading advice, and for virtual currency purchases and trading on behalf of customers under McDonnell’s direction. Continue Reading U.S. District Court Reaffirms CFTC’s Authority over Cryptocurrency Fraud