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Comment by throw1234651234 | Hacker News Reader

It's absolutely unclear what the SEC is doing here at all. Why is ALGO a security and ETH is not? They do the same thing. What are the implications of this lawsuit? Completely unclear. This is vague and unhelpful.

edit: Keep downvoting - the fact, with a clear example, remains.

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When was ETH declared as not a security? I don't remember hearing anything about that.

The SEC says only BTC is a commodity:

https://www.axios.com/2022/06/28/bitcoin-is-the-only-coin-th...

The CFTC says only BTC is a commodity:

https://cryptoslate.com/cftc-chair-rostin-behnam-snubs-ether...

People keep saying that regulation is unclear, when let's be honest, it's perfectly clear. Just not what a lot of people wanted to hear.

The fact that they have been asked, point blank, by congress, "is ETH a security?" and the SEC wouldn't answer is pretty fair for claiming "not perfectly clear."

Even here, it wasn't all of ETH that is under question. So, if you have bought some ETH from coinbase, it isn't under fire here. If you paid them to stake your ETH, it is. It is unclear, to me, what it would mean for any ETH you staked personally.

That's the root of the problem - it's absolutely unclear what the global implications are and if this will be used to go after individuals staking on their own, etc.

No agency has the resources or interest to go after individuals that aren't doing anything especially egregious.

I've watched that interview, congress would ask a loaded question, framed in a fallacy[1], the chair would start answering it, and the congresscritter would interrupt him and throw a tantrum. Repeat 5x.

It wasn't a good look. For the congresscritter.

(I wonder how much money he's gotten from Sam, CZ, and Coinbase...)

[1] The fallacy in question is the congresscritter's claim[2] that a security can't also be a commodity. This is trivially disprovable by a simple example - an isolated company town using scrip, where the scrip also happens to be company stock.

[2] Whenever the chair would start responding to the fallacy, the congresscritter shouts over him, because if he doesn't, his argument-in-the-form-of-a-question falls to pieces.

He wouldn't start answering. He was asked "yes or no, is ..." and would start hemming and hawing with words that were neither "yes" or "no."

Have you stopped beating your wife?

Yes or no. No hemming or hawing. It's a simple question, yes, or no?

----

Is it clear to you now that a simple yes or no question, couched in an incorrect assertion is not actually a simple yes-or-no question?

A question where answering easily implies past behavior is very different from one that does not. "Do you think it is ok to beat your spouse?" better not get any slow rolled answer, and is more comparable here.

Hell, I'd be fine with a hedged answer of "it can be." That would make a ton of sense and would make sense. Akin to asking "is it speeding to drive your car at 40?" The answer would be "in certain situations, certainly. Can be too fast and it can be too slow." So an answer of "I can't answer without more context" would be fine.

None of that is what I saw.

Past behaviour isn't the issue. An incorrect assertion is the issue.

Let me give you another chance to answer a simple yes or no question.

----

Since it's obvious that democrats are all criminals and baby-eaters, is Elizabeth Warren a democrat?

Yes or no. No hemming or hawing. I'll interrupt you as soon as I hear any words besides those two. Your answer or failure to answer will appear as a headline in the New York Times.

----

The chair was responding to the statement made in the question, the congressman just didn't like what that response was, which is why he kept interrupting.

The question was literally "is ETH a security?" To compare that to the questions you are stating is laughably bad faith argument.

Though, I'll bite. What statement is made by the question "Is ETH a security?" Why is that a question that can't be answered with "Yes", "No", or "it depends how it is packaged"?

The question was literally "Because something cannot be both a security and a commodity, is Eth a security?"

The chair's answer was, as we can glean from the interruptions (but who the hell really knows, the man's not allowed to finish a sentence) 'It depends'.

If he was saying "it depends" he had a lot of words to say that. His sentences were like my talking to the kids when I ask "did you do your homework?" It was painful.

And note that some things can be both a security while wrapped around a commodity. Just look at brokered CDs. Such that, even if you agreed that ETH is a commodity, you can still have financial instruments on ETH that are securities.

For any who might be interested, a link to the exchange that this user is comparing to asking if "democrats are all criminals and baby-eaters" [0]. Remember, the law is "extremely clear" on whether these tokens are securities or commodities, according to the GGP commentator.

[0]: https://youtu.be/VhA1dZXeao0?t=58

No, I have not stopped beating my wife.

> People keep saying that regulation is unclear, when let's be honest, it's perfectly clear. Just not what a lot of people wanted to hear.

I honestly don't know how you can say that with a straight face if you have ever looked into this for more than 5 minutes.

The regulation is not clear and they refuse to clarify when asked on many important topics. Compare that to other security related issues, where regulators are very proactive about clearly defining what is what, publishing explainers, etc. etc.

I think ETH should have been classified as one too, due to its ICO. Making an exemption for that was a mistake...

Let's ask Gensler what are his thoughts about ETH then

https://twitter.com/sassal0x/status/1648338351832064003

Oh wait ... :-)

That's amazing on the level of refusal to answer a simple question.

The primary use cases of ETH are changing state of the network and collateral for state change validation. Requester pays to effect change and some ETH is burnt and some goes to validators to incentivize operation. What other security does that? I don’t expect profit when using it to change state of the network.

Howey test.

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