The question of whether Ethereum (ETH) is a security seems to be about to be answered?
In a recent interview on CNBC’s Squawk Box, former SEC Chairman Jay Clayton offered his perspective on the continuing discussion regarding whether Ethereum (ETH) should be regarded as a security.
“The courts are not an efficient place to resolve classification issues in securities.” “Europe is trying to figure out how to bring crypto into the financial system, whereas the US policy is on keeping it out of the system.” says former @SECGov chairman Jay Clayton @SquawkCNBC pic.twitter.com/t2i0bCU6Hj
— William Mougayar (@wmougayar) April 21, 2023
Clayton sued Ripple while he was CEO, claiming the business had performed an unauthorized securities offering. In the interview, Clayton talked about how European regulators handle cryptocurrencies and emphasized how open-minded they are to integrating technology into the regulatory framework.
He emphasized the current system’s inefficiency, which relies on the courts to settle categorization disputes involving securities and commodities. Clayton also concurred with Gary Gensler, the current chairman of the SEC, that a sizable fraction of cryptocurrencies would qualify as securities.
When Becky Quick of CNBC asked about Ethereum’s prospective position as an unregistered investment, Clayton compared it to a Broadway play to make his case. He made the case that the play’s early production investments may be regarded as securities if the prospect of future ticket profits accompanied them.
However, they cease to be securities and become merely tickets if the play succeeds and tickets are sold at the box office. Clayton used this reasoning to argue that Ethereum is more like a “ticket” than a way to raise money, though he conceded he was unaware of all the details.
The topic of Ethereum’s regulatory status is still up for discussion. While avoiding inquiries regarding the second-largest cryptocurrency, Gensler repeatedly suggested that all Proof-of-Stake (PoS) coins are securities.
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