SEC Clears Ethereum “Security” Doubt As It Announces Reforms |

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The SEC has been very controversial many times especially in this year when cryptocurrencies have taken centre stage in the economic sector. From their strife with Ripple, to the rejection of a Bitcoin Exchange Trading Fund. As though that wasn’t enough, three months ago Commissioner Hinman mentioned that Ethereum is not a security. This definitely raised some eye brows in the crypto community due to the fact that the same SEC had already tagged Ripple’s XRP as being a security. He mentioned that

“And putting aside the fundraising that accompanied the creation of Ether, based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions.”

Fortunately, the chairman who was also the Divisional Head of Corporate Finance has had the “errors” he made at the Yahoo All Markets Summit back in June in Francisco corrected. Mr. Jay Clayton, the current SEC chairman, has come out to state that Commissioner Hinman’s comments are not to be considered as a law or a binding code for the SEC or anyone else to follow in handling or investing in Ethereum.

“The Commission’s longstanding position is that all staff statements are nonbinding and create no enforceable legal rights or obligations of the Commission or other parties.”

The statement included a disclaimer; which mostly differentiates between the SEC’s laws and rules, and the commission’s members views. Moreover, it also clarified their plans to emphasize the differences between laws and staff comments.

“As we carry out our market oversight functions, I believe we at the Commission should keep this important distinction in mind.  Several weeks ago, I instructed the directors of the Division of Enforcement and the Office of Compliance Inspections and Examinations to further emphasize this distinction to their staff.”

The one who really had the punch was Ripple’s XRP. The SEC has had a never-ending battle with Ripple Labs over its XRP digital token. The commission has countlessly stated that it believes the XRP token is a security.

There have been a number of protests within the Ripple Community to annul the FUD that brands the Ripple XRP token as a security. Per the FUD, Ripple XRP is the most centralised and manipulated cryptocurrency, making it more a security than a digital asset as most cryptocurrencies.

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