Ethereum It is not a security! Has the SEC been co-opted?
10 September 2018 by Paul de Havilland
Has the SEC been co-opted? The position of the regulator in respect of the encrypted assets is nothing if not inconsistent, oscillating between absolute hostility and prudent accommodation. But the lack of recent noteworthy actions on ICOs and its position that ether is no longer a security could suggest that the regulator was under pressure from pro-crypto investors to lend to the industry. cryptographic ecosystem more space to grow unhindered by overbearing titles regulations
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Initial coin bids are bad … But lawyers
If the US Securities and Exchange Commission has been consistently clear on one thing is that the ICOs exceed (that is, fail) the Howey test and are investments made with the expectation of future returns deriving from the recipient's efforts. That is the proof of Howey's claret almost to the letter .
Jay Clayton told the US Senate Banking, Housing and Urban Affairs Committee that all the ICOs he had watched offered titles. Yet despite the occasional high-profile quotation and forced closure, there have been relatively few obvious actions in favor of the SEC to close them.
As @msantoriESQ points out, oranges are not titles (Howey test), so I'm fine with Ether not being seen as one. What pisses me off is that people who have offered ICOs (unregistered titles that do not offer fairness), despite being illegal and shameless, have never had consequences.
– John Carvalho (@BitcoinErrorLog) June 14, 2018  The top securities watcher did not take part in the highly publicized Cryptosweep operation announced in May of this year by state and provincial regulators throughout North America.
Perhaps the refusal of start-ups to sell tokens to American citizens has helped to ease the pressure. So, why the need for Operation Cryptosweep? Probably, however, the SEC decided to take a different approach.
It has been suggested that the Commission is happy that token investors undertake collective legal actions against ICO operators if there is evidence of fraud or a significant loss, thus washing the hands of the need to take preventive action protect investors. But is not protecting investors at the center of the SEC job description?
Being free does not get you off the plane tickets are also the titles
Tomahawk Exploration has learned to the full that air flight tokens are not a viable way to avoid securities regulators. It seems clear, therefore, that ICO tokens are free or not. This makes the relative inertia of the SEC even more perplexing.
SEC specifically emphasizes that tokens distributed via airdrop / bounty may still be securities because "… a" gift "of a security is a" sale "under the
Securities Act when the donor receives a real benefit "Expect a debate on what constitutes a" real advantage ". https://t.co/uddgQapXe6
– Drew Hinkes (@propelforward) August 14th 2018
Are SAFT a safer way to go?
An alternative to the ICO fund-raising mechanism, simple agreements for future tokens (SAFT), has emerged as a way to sell securities without, well, selling securities. SAFTs are agreements to buy tokens when, and if, the platform on which these tokens will be used for and on are built.
On the surface, SAFTs have the protections of investors in place, as they encourage ICO teams to develop functioning products and to discourage those who do not intend to establish a legitimate concern in progress.
Not so fast. Even the SEC does not like SAFT. It seems, however, that they are willing to tolerate them as long as what startups sell are not called tokens and, of course, is not sold to the Americans . It's not different from the rhetoric that surrounds the ICOs, really.
Ethereum is not a security … more? Has the SEC been co-opted?
The amazing statement by the SEC that ether is not a security has taken many by surprise. For William Hinman of the SEC:
"When we look at how Ether is operating today we see a highly decentralized network, and we do not see a third central part."
Since the body claims that ether was probably a security when it was launched, the free pass for Ethereum was an extraordinary admission that start-ups can avoid the securities regulation network until they are discovered too early.
Keen SEC watcher @YangVentures suggests the regulator the staff members know that some of the most positive public noises of the commission regarding cryptocurrency are not honest. And this includes positive noises on the ether .
If ether is not a security in the SEC's eyes, only two logical reasons could explain it: they did not understand it quickly enough or the body was so weakened by its contradictory and confusing position that, in absence of a resounding and shameless fraud, startups have won the definition war. Or rather, the war of non-definitions.
C & # 39; is a further plausible explanation. The hearts and minds of the SEC have been captured by the cryptic community that is happy enough to let regulators and state lawyers do their dirty work, while confusing the waters of the market with contradictory narratives.
– supported by influential cryptographic defenders, including the powerful Coin Center think tank? Because if it were not, he was sitting in his hands wondering what to do, failing to provide the markets with clarity.
What do you think? Has the SEC been co-opted by powerful cryptographic groups?
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