Feb 11, 2023
Joseph Lubin Confident ETH Not Classified as Security in US
Joseph Lubin, Ethereum co-founder and founder of blockchain tech firm ConsenSys, is confident that Ether (ETH) will not be classified as a security in the United States.
At the Web3 event, Building Blocks 23, in Tel Aviv, Cointelegraph spoke with Lubin to discuss the possibility of the U.S. classifying ETH as a security after Ethereum’s transition to a proof-of-stake (PoS) consensus model.
Lubin stated that it is as unlikely for ETH to be classified as a security as it would be for Uber to be made illegal, saying, “There would be a tremendous outcry from not just the crypto community but different politicians and certain regulators.”
In September, Securities and Exchange Commission Chairman Gary Gensler suggested that the blockchain’s transition to PoS might have brought ETH under the regulators’ beat. Gensler believed staking coins gave “the investing public” anticipation of “profits based on the efforts of others.”
Lubin has been involved in discussions with the SEC and the Commodity Futures Trading Commission for years. He stated that five years ago the regulators were “just trying to wrap their heads around what tokens were,” and that he and the crypto community “helped them significantly understand lots of tokens are not securities.”
Lubin believes ETH is “sufficiently decentralized” and pointed to its “many use cases that don’t implicate it as a security.” He added, “There is no centralized set of promoters or builders that is specifically trying to raise the value of Ether and enrich investors.”
The Ethereum co-founder also said that regulators appear to be more focused on stablecoins at the moment.
In a Feb. 9 Twitter thread, Coinbase founder and CEO Brian Armstrong responded to “rumors” that the SEC was thinking to ban retail consumers from staking crypto. Armstrong stated that staking is not a security and it would be a “terrible path for the U.S.” if a staking ban was passed, noting that it was “a really important innovation in crypto.”
Joseph Lubin is confident that Ether (ETH) will not be classified as a security in the United States. He believes that the blockchain’s transition to a proof-of-stake (PoS) consensus model does not make ETH a security, as there is no centralized set of promoters or builders trying to raise the value of Ether and enrich investors.
Lubin has been involved in discussions with the SEC and the Commodity Futures Trading Commission for years, and believes that the crypto community has helped them understand that tokens are not securities.
Regulators appear to be more focused on stablecoins at the moment, but Coinbase founder and CEO Brian Armstrong responded to “rumors” that the SEC was thinking to ban retail consumers from staking crypto. Armstrong stated that staking is not a security and it would be a “terrible path for the U.S.” if a staking ban was passed.
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