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Ethereum is facing trouble with the SEC

May 08, 2018 Posted /  2246 Views

Ethereum is facing trouble with the SEC

All the eyes and ears of the Crypto enthusiasts are turned towards the meeting between the US officials, where they might entitle Ethereum as a security, but the developers, on the other hand, have shown signs of caring in a three-day meeting that concluded last week, where security and scaling were the main factors discussed.


Joseph Lubin, the co-founder of ethereum was probably the only one who mainly focused on the question that he was not at all concerned whether the US securities and exchange Commission categorizes Ethereum as a security or not at the Community Ethereum Development Conference held in Toronto. It even featured stuffed animal unicorns, coders dancing, and t-shirt clad attendees, who were mostly in their 20’s. Many of the CO-founders also attended whose applications are built on the ethereum network. Lubin made it clear that the digital asset is purely used to fuel the applications which are built on the platform but it is not a stake or an investment in the company.  


On April 25, a statement from the ethereum foundation read that ether is like “the gas in a vehicle that is relied upon for every action performed by thousands of independent applications, developers and users who themselves will determine the success and value of the Ethereum platform,” adding that, “the Foundation neither controls the supply of, nor has the ability to issue Ether, and the quantity of Ether that the Foundation holds (under one percent of all Ether) is already lower than that held by many other ecosystem participants.”


Regulators are continuously trying to decide whether Ethereum is a cryptocurrency or not, and ether as a security, which indirectly means that only exchanges regulated by SEC would be able to trade it. It would even provide higher restrictions to the tokens built on the Ethereum network.


Co-founder of a decentralized network for financial services, OmiseGO, Donnie Harinsut seemed to echo Lubin’s idea when the company sold almost 25 million dollars of its OMG tokens in the Initial Coin Offerings, last year.


OMG “is not a cryptocurrency, it’s a token made to run on a network,’’ said  Harinsut. He even pointed out that they were a Bangkok based company and their users were from Thailand who has actively given encouragement and support to execute their currency projects.


Vitalik Buterin, the creator of Ethereum, at a panel of the discussion said that he observed no fundamental roadblocks for the implementation of sharding.


Also, a huge portion of the conference was dedicated to on the discussion of Casper, which is a proposed change in the way Ethereum network validates a particular transaction. The main idea was to shift from proof of work which requires a high amount of energy to efficient proof of stake Concept. Buterin, in the discussion, was mainly focused to inspire more peoples to use the Casper protocol to validate the transactions. He even explained the benefits and punishment it rewards.


The development of all these Technologies will be the base for the Ethereum’s future, as to how this technology transforms the industry by eliminating all the middleman and the centralized authority through the self-executing code.

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Tags: Ethereum SEC Omisego

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