Comment by hackingforfun | Hacker News Reader

Comment by hackingforfun | Hacker News Reader

Parent Full thread

Is Bitcoin a security? How is something that is decentralized a security? If it was a security, should there be charges against Satoshi Nakamoto, who no one can reliably tie an identity to, and who might even be deceased? Or should the Bitcoin Core dev team be charged, in that case? Or should Bitcoin miners be charged? In my opinion, it's more nuanced than you make it out to be.

The way I'm interpreting what you are saying is that you would like if everyone would just abandon crypto and avoid it, because some / all of them could be considered a security (or because you and others don't like it, for other reasons, I'm not sure, exactly). The only way that it could be "clear" is if the SEC explicitly says which ones are securities, which has not happened, except for a few specific cases [1][2][3][4][5]. By the way, I'm for the SEC going after bad actors / scams, although I'm not convinced that that is what's happening with all of these cases, although perhaps some of them.

Anyway, since you mentioned companies, I'll give you the benefit of the doubt here, and I generally agree that crypto companies should maybe reconsider the position of skirting regulation. However, if we are talking about the crypto ecosystem as a whole, then I do not agree. I personally think this is new territory and crypto will play an important role in the future of our financial systems.

[1] https://www.sec.gov/enforce/33-10715-s

[2] https://www.sec.gov/news/press-release/2020-338

[3] https://www.sec.gov/news/press-release/2021-172

[4] https://www.sec.gov/news/press-release/2020-262

[5] https://blog.coinbase.com/the-sec-has-told-us-it-wants-to-su...

Nobody is saying BTC is a security.

The SEC is saying that 'Kin' token is a security [1][2].

The SEC has already defined what a security is, so if you want them to not classify your new token as a security, then don't make it one.

Kin was sold just like a stock in a company, but without the disclosure or other rights.

BTC was not.

[1] https://cointelegraph.com/news/sec-vs-kik-interactive-a-stat...

[2] https://www.dlapiper.com/en/us/insights/publications/2020/10...

Reference [4] from my comment was about Kik. I think we agree there.

Also, FWIW, reference [2] from my comment was about Ripple / XRP, which I figured if any crypto project was a security, they were, since it was linked to a for profit company. I was not surprised to see that they were charged.

Anyway, I'd love for the SEC to say BTC is not a security, when asked a direct question about it, however, they have not yet, which is one of the reasons why I don't agree that the regulatory framework is clear, yet.

Ethereum also did an ICO so it probably was a security to start with (Gary Gensler said most ICOs are probably securities), but then Ethereum became decentralized enough, so then it's probably not still considered a security. So where do we draw the line for new projects? If they aren't prosecuted within a certain amount of time, then they are fine?

This is what I mean. It's a nuanced discussion. I don't think there should be scams, and it would be great if the regulators protected against bad actors. I agree that new projects should not market themselves like stocks / securities. However, in my opinion, not all cryptos should be considered securities. Based on all this, would you consider Bitcoin and Ethereum to be a separate class of assets? This is what I'm trying to get at. We can't group all crypto into existing securities laws. There probably should be regulation, but let's be clear about which ones are and which ones aren't. I have yet to see that clarity from US regulators.

Yes, they should provide guidance on BTC and probably should provide a bunch of test cases with clearer parameters. They're acting like Justices where they need to see the case, instead of providing exemplary framework for classification. Yes, I think in that case it's fair for them to be more proactive in delineating between groups.

I agree and I hope this is the route that they will follow.

Reply on news.ycombinator.com