Ethereum is “of course” a security

Ethereum is "of course" a security

Michael Saylor, CEO of MicroStrategy and Bitcoin (BTC) investor, said Ether (ETH) was a “clear” security and reiterated that BTC is the only commodity in the cryptocurrency industry.

In an interview with Altcoin Daily, Saylor was asked about his position on the classification of BTC and ETH as commodities by U.S. Senators such as Kirsten Gillibrand and Cynthia Lummis, as well as senior figures from the Securities and Exchange Commission (SEC) and the Trade Commission Commodity Futures (CFTC).

Saylor explained at length what he thinks are the fundamental differences between the Bitcoin and Ethereum networks, suggesting that only the first of them has remained unchanged over the years:

“I think Ether is a safe bet, I think it’s pretty clear, […] it was issued by ICO, there is a management team, there was a pre – mine, there is a hard fork, there are constant hard forks, there is a bomb of difficulty that never stops postponing. »

The CEO argued that the continuing need for software updates on a network run by a team or indicator entity indicates that ETH is security. He cited as an example the design of the deceleration difficulty bomb, which he says “murdered” the entire ETH mining industry.

According to Saylor, to classify a digital asset as a commodity, it must “support a complete decentralized protocol that no one can change even if they wish.”

“To be an article, there can be no issuer, and the truth is, you can’t really make decisions. I mean one of the basic ideas in the cryptocurrency industry is that you can change it. What which makes it safe, “he said.

Securities used to raise capital on public or private markets are generally considered to be negotiable and negotiable financial instruments. On the other hand, goods or assets that are of monetary utility are considered. Assets such as gold and silver are considered hard goods, and soft commodities are goods such as rice or tea.

Saylor reiterated that BTC is a commodity because the core of the Bitcoin network cannot be changed, just as the physical composition of gold is:

“If you want to establish yourself as a digital commodity, you try to create something like gold in cyberspace.”

However, despite Saylor ‘s arguments, the Bitcoin network has seen multiple upgrades over the years. The most notable of recent was the November 2021 Taproot soft fork, which aimed to enhance Bitcoin’s scripting capabilities and privacy.

When asked what he thinks of other altcoins as Cardano’s native sign, ADA, Saylor reiterated his maximum comments, saying:

“I think all proofs on betting networks are securities and they are all very risky […] it’s above my pay grade, regulators will decide whether or not to allow them to continue or not. “

Read also: Bitcoin is ‘cheap’ at $ 20,000 as bitcoin’s a price – to – wallet ratio similar to 2013

MicroStrategy went on to say that one of the main reasons it favors BTC over all other cryptocurrency assets is its fear that altcoins are non-compliant security tokens that could be removed by law.

Saylor’s MicroStrategy continued to buy BTC despite the fall in the value of this asset in 2022. As of June 29, the company had 129,699 BTC worth approximately $ 3.98 billion.

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