There are some interesting developments taking place within the legal system. We all know how Gary Gensler and the Securities and Exchange Commission (SEC) are going after cryptocurrency.
It is the position of the agency that all cryptocurrency coins are securities. This means the selling of them, unless registered, is a violation of securities laws.
There were some landmark cases against the likes of Block.One who sold $4 billion of EOS through its website. This led to the payment of a fine of $20 million. Many looked at it as a small price to pay for $4 billion in Bitcoin and Ethereum.
Most presume the SEC is untouchable. The tendency is to give in and pay a fine. This is what Block.One did. However, a few step up to take the fight back to the SEC.
One of those was Ripple. And this is a situation that could radically alter the future of cryptocurrency.
Split Decision
There are some experts who believe the judge in the Ripple case could issue a split decision. By this, Ripple would be guilty of selling an unregistered security, thus in violation of the U.S. Securities Law.
However, this would only apply to actions taken before 2018. The view is that the selling of the coins in 2018 did not affect the market action. Here is where the split decision could enter.
Even though the company was guilty early on, it was over by the that date. This could open the door for projects like Ethereum to follow a similar path.
Ethereum is now in the crosshairs after switching to a proof-of-stake mechanism. Gensler has, not surprisingly, claimed that Ethereum is now a security. At this point, is there are material effect on the market considering how large it is.
Hole In The Armor
It is easy to fall victim to believe that the SEC is invulnerable. Losing a couple cases could really hinder the facade the agency is bringing to the table regarding cryptocurrency.
Since the agency is basically trying to write regulation via enforcement, any setbacks could be tremendous for the industry. It also can pit the courts against the Congress as it wrestles with writing regulation. If there are court decisions that go counter what that body sets for, it could be open to litigation.
It is important for the industry to fight on all fronts. In the end, it is my view, the technology is where things will excel. That means we develop around whatever they set forth. That said, challenges or pushback to what the governments are doing is helpful.
Desantis Looking To Ban CBDC In Florida
This week, the Governor for the State of Florida and presume candidate for the Republican nomination for President stated that he is seeking to ban CBDC in the state.
While this made headlines, it is likely nothing more than a gesture. It would be impossible to ban them in terms of the Federal Government approving them. What this moves does, however, is draw a line in the sand. Sure, it is political but whatever joins the fight.
Again, this is a move to help buy time. If technological development is truly the solution, then the more time to complete that, the better.
This is a major fight that is happening on a global scale. It will be interesting to see where different participants fall.
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