A high-ranking official at the U.S. Securities and Exchange Commission (SEC) stated that Ethereum (ETH), the indigenous cryptocurrency of the Ethereum blockchain, is not security according to the federal directives.
Ethereum (ETH) will not be ruled as a security
Addressing the Yahoo Finance All Markets: Crypto Summit on Thursday, William Hinman, the head of the SEC’s Corporate Finance Division, stated that, at least “as currently structured,” Ethereum (ETH) is not going to be ruled as a security by the SEC.
“When we think about how the ether is operating today, at least, we see a highly decentralized network, not the kind of centralized actor that characterizes the supply of securities,” stated William Hinman.
“In its current state, we don’t see value regulating it,” the Director of SEC’s Corporate Finance Division added.
The Ethereum (ETH) tokens sold during the initial ICO lost their potential to be designated as securities
William Hinman also pointed out that, in spite of the manner in which the Ethereum (ETH) cryptocurrency had originally been emitted, namely, employing a massive ICO-style bulk sell-off, the Ethereum blockchain had been adequately decentralized.
Accordingly, Ethereum Foundation is no longer holding any part, and that assets that had originally been sold as securities can get rid of such a potential denomination in the future.
Before that, SEC’s Chairman Jay Clayton had stated that cryptocurrencies like Bitcoin (BTC) are not securities, even though the agency had not yet finally designated any other cryptocurrency to be regarded as currency and not securities.
Although this declaration is not yet an official act to rule out the designation of Ethereum (ETH) as a security, it is good news for the ETH and the Ethereum blockchain, as well, because it clearly indicates that the SEC is thinking to exclude ETH from its list of cryptocurrencies that will be nominated as securities, sooner or later.
Jackson Bey was born and raised in Lethbridge Alberta but moved east when he was 22. Apart from running his own consulting firm. Jackson spends his time canoeing the many lakes of Ontario. As a financial journalist Jackson has published stories for CBC Business Online, as well as Buzz Feed and Motherboard. As a contributor to Billionaire 365, Jackson mostly covers markets and trade.