LONDON (Bywire News) - When is a cryptocurrency a security? That's what is proving to be a key question for the crypto community, and a new development could be a huge boon for EOS.
By giving evidence in the ongoing lawsuit between the SEC and Ripple, the SEC now argues that it has not stated, contrary to common belief, that Bitcoin and Ether are compatible cryptocurrencies. Ripple is currently defending itself in a lawsuit filed by the SEC accusing it of executing unlicensed securities. If the court rules in favor of the SEC, the implications for Ripple and other cryptocurrencies could be devastating.
The question of whether cryptocurrencies should be viewed as currencies in their own right or securities will be crucial to how the sector will be regulated. The SEC evidence, in this case, represents the latest in a series of indications that the regulatory landscape could be moving against cryptocurrencies. In a recent interviewGary Gensler, the current SEC chairman, said he agreed with his predecessor's view that any cryptocurrency launched as a result of an ICO could be classified as a security.
Until now, Bitcoin and Ether had been notable exceptions. In 2018, the SEC's Chief Financial Officer William Hinman said they would not be treated as securities in part due to their decentralized nature. Their evidence in this new case would appear to contradict this stance and could mean that almost all cryptocurrencies face intense investigation.
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For EOS, however, it could be good news. In 2020, the SEC sued B1, who deemed its $ 4 billion ICO launched by EOS to be an unlicensed security. B1 agreed to pay a $ 24 million settlement but did not admit. Crucially, it obtained a waiver from the SEC from the usual restrictions that would normally have been established with one of these resolutions.
It can be argued that the decision means that EOS has also satisfied the SEC about its status and places it in an exceptionally favorable position. If the SEC's evidence in Ripple's lawsuit is to be taken at face value, all cryptocurrencies, including the big two Bitcoin and Ether, could be classified as a security, which may put them in the regulator's line of fire.
Cast a shadow over the entire sector except for EOS. That deal with the SEC could now turn out to be incredibly valuable. You've already done the hard work and satisfied the regulator. It may be that the EOS case represents a path for other cryptocurrencies to settle with the SEC. For now, although I have a unique status and it represents the safest cryptocurrency to invest. Once the market takes notice, the sky could be the limit.
(Written by Tom Cropper, edited by Klaudia Fior)
