Ethereum: Gary Gensler classifies any crypto token except Bitcoin as a security including ETH and others – Report
- Gensler warned investors that most crypto tokens, without naming a few, will not survive in the long term.
- The cryptocurrency market has grown into a trillion-dollar industry, with Bitcoin holding a dominance of roughly 42 percent.
The path to deregulation of crypto in the United States leads most digital assets except Bitcoin to unregistered securities, according to recent revelations by SEC Chairman Gary Gensler. After classifying the stakes provided by Kraken’s cryptocurrency exchange as unregistered securities, the secured proof-of-stake (PoS) blockchains, including Ethereum, Cardano and Solana, are looking at a challenging time ahead.
In accordance JPMorgan banking analysts, more crypto regulations related to stablecoins and the staking sector come after recent events. Crypto projects with organized people working towards their prosperity are bound to be classified as unregistered securities in the US.
This despite former SEC officer William Hinman publicly indicating in 2018 that Bitcoin and Ethereum were not securities. The infamous speech has come to be used in Ripple vs SEC Lawsuitwhere Brad Garlinghouse and his legal team claim XRP is not a security.
Gensler note
According to Gensler, everything but Bitcoin has security features and must be registered under securities laws.
Anything but bitcoin,” Gensler noted, “you can find a website, you can find a group of entrepreneurs, they can set up their legal entities in an offshore tax haven, they can have a foundation, they can lawyer it up to try to arbitrate and make it difficult jurisdictionally or so on.
Gensler warned investors that most cryptocurrency tokens would not survive long term.
They can first release tokens overseas and claim or pretend it will take six months before they return to the US
He continued argued
But at their core, these tokens are securities because there is a group in the middle, and the public expects profits based on that group.
Crypto Market Outlook
The cryptocurrency market has grown into a trillion-dollar industry, with Bitcoin holding a roughly 42 percent domino. The Ethereum network, the king of smart contracts, has a market dominance of around 18.5 percent. The rest of altcoins, including stablecoins, share 40 percent of the cryptocurrency industry. However, Bitcoin market share, especially in the US, is bound to increase in the coming years as regulations favor its adoption.
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Nevertheless, the Ethereum market may also rise after the launch of the layer 2 scaling solution by Coinbase Global called base.
Technically, US federal regulators do not object to cryptocurrency assets being used as a store of value. The regulators are concerned that they should be used as currency due to the high volatility and liquidity.
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