Feb 11, 2023
Joseph Lubin Confident ETH Not Classified as Security in US
Joseph Lubin, co-founder of Ethereum and founder of blockchain tech firm ConsenSys, has expressed his confidence that Ether (ETH) will not be classified as a security in the United States. During a recent visit to Tel Aviv for the Web3 event, Building Blocks 23, Cointelegraph spoke with Lubin about the potential implications of Ethereum’s transition to a proof-of-stake (PoS) consensus model.
In September, U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler suggested that the blockchain’s transition to PoS might have brought ETH under the regulators’ purview. Gensler argued that staking coins offer the “investing public” anticipation of “profits based on the efforts of others.”
However, Lubin believes ETH is “sufficiently decentralized” and pointed to its “many use cases that don’t implicate it as a security.” He also noted that the SEC and the Commodity Futures Trading Commission (CFTC) have been discussing the issue of tokens for several years.
“They thought back then that everything was a security. We — I think — helped them significantly understand lots of tokens are not securities, and then they went away and Gary and team now think almost everything’s a security,” said Lubin.
Lubin also noted 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 argued that staking is not a security and that it would be a “terrible path for the U.S.” if a staking ban was passed.
The potential of Ethereum as a platform for Non-Fungible Tokens (NFTs) and the rise of NFTs as a form of digital asset are also driving the growth of the web3 space. NFTs are digital assets that are unique and cannot be exchanged for another asset. They are used to represent digital assets such as art, music, and even virtual real estate.
NFTs have been gaining traction in the crypto space, with many artists, brands, and companies leveraging them to promote their products and services. Twitter has become a hotbed for NFT marketing, and NFT marketing agencies are popping up to help brands and companies capitalize on the trend.
As the web3 space continues to grow, it is important for regulators to provide clear guidance on the legal and financial implications of the technology. This will help ensure that the industry can continue to innovate and create new products and services without fear of legal repercussions. It will also help ensure that consumers are protected from potential scams or fraudulent activities.
Joseph Lubin’s confidence in Ethereum’s ability to remain outside the realm of securities is a positive sign for the industry. It is also a reminder that the crypto space is constantly evolving and that regulators must stay ahead of the curve in order to protect consumers and promote innovation.
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