Globally, nations are debating the extent to which cryptocurrencies should be regulated. Different nations and their leaders have different takes on the subject.
In an interview recently, the chair of the SEC Jay Clayton said that bitcoin can not be considered to be a security. Michael Saylor of the Saylor Academy echoes the sentiment.
He said that cryptocurrencies are, typically, deemed to be replacements for fiat currencies. In his opinion such currencies can not be treated as securities. All this talk assumes significance because of all the global debate around regulations for cryptocurrencies. A large portion of the debate is centred on the utility of cryptocurrencies as securities.
However, he desisted from commenting on ethereum and ripple being considered as securities. The SEC uses the Howey test to assess if an asset can be classified as a security. BTC does not the pass the test and therefore cannot be classified as a security. Also, it is well known that BTC has never used public money to be able to develop its technology. However, many are of the opinion that on many counts XRP could be classified as a security.
The stand with respect to ethereum’s tokens is also unclear. Many are of the opinion that these tokens need to be classified as securities. Many allege that there is a concerted effort to pass these tokens off as utility tokens.
SEC has publicly stated that it wants to regulate tokens. They consider tokens to be securities. And, the SEC would therefore want to regulate the issue and trading of tokens. The SEC is also rather firm in its intent to go after fraud tokens. The SEC claims that it has maintained this stand for long and it has worked to safeguard investor interests. However, all this has not gone down well with the crypto community.