Is Ethereum a security or commodity?

Is Ethereum a security?

Gensler’s public stance on the number two crypto marks a stark contrast to his predecessor Jay Clayton, who stated that Ethereum was not a security during his tenure at the helm of the SEC. Securities are instruments that represent ownership in a common enterprise with an expectation of a profit.

Is cryptocurrency a security or commodity?

Virtual currency is a digital representation of value that functions as a medium of exchange, a unit of account, and/or a store of value. Is Bitcoin a commodity? Yes, virtual currencies, such as Bitcoin, have been determined to be commodities under the Commodity Exchange Act (CEA).

What is Ethereum classified as?

Ethereum itself is a blockchain technology platform that supports a wide range of decentralized applications (dApps), including cryptocurrencies. The ETH coin is commonly called ethereum, although the distinction remains that Ethereum is a blockchain-powered platform and ether is its cryptocurrency.

Why is Ethereum a commodity?

CFTC Commissioner Quintenz said that the SEC and his agency both share responsibility for the regulation of futures contracts on securities. The Commissioner clarified that there is currently a futures contract on Ether. Therefore, it is only “under the CFTC’s purview, which makes ETH a non-security commodity.”

What happens if ETH is a security?

If ether is a security, what happens to the price? If it’s a security, then crypto exchanges are in trouble. They would have to register with the SEC, since they’d be trading in securities, and would face fines if they didn’t.

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Are cryptocurrencies a security?

In 2018, Clayton clarified in an interview with CNBC that true cryptocurrencies (i.e., those that simply act as replacements for traditional fiat currency) are commodities rather than securities (“SEC chairman: Cryptocurrencies like bitcoin are not securities” June 6, 2018).

Which cryptocurrencies are securities?

The SEC considers just about all cryptocurrencies to be securities, according to Bragança. The only ones that are safe (i.e., just assets) are bitcoin – it truly is decentralized, says Bragança – and ether.

Why bitcoin is not a commodity?

It’s of little use as a store of value because of its volatility, and is hampered as a means of exchange by its slow network and high transfer costs.

What is a security vs commodity?

A security is a financial instrument, but a commodity is not a security. Just like a commodity, a security too has a monetary value, but unlike a commodity, a security is not traded between just two parties. A security can be traded between multiple parties.

Is Ethereum a security Reddit?

On a rollup or a plasma, you are just as secure.

A quick reminder of what “shared security” means and why it’s so important.

[— Asset is issued on —] [— You are using that asset on —] [— Security level —]
Avalanche Ethereum Low
Ethereum StarkEx (rollup mode) High
Ethereum Arbitrum High
Optimism Ethereum High