SEC Official: Ether Is Not A Security

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by Coin AIO 1068 views 659

Ethereum" href="http://coinaio.com/tag/ethereum.html">Ethereum is not a security, says U.S. Securities and Exchange Commission (SEC) director of corporate finance William Hinman.

Speaking at the Yahoo! All Markets Summit: Crypto event in San Francisco Thursday, the official told the audience that "We don't see a lot of value in treating ether today as a security," explaining that the fact that there is no central figure or group responsible for ethereum, and therefore "the assets may not represent an investment contract."

In pre-written remarks, he said:

"Based on my understanding of the present state of Ether, the Ethereum" href="http://coinaio.com/tag/ethereum.html">Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions."

Hinman added that similarly, bitcoin is not a security due to the nature of its network.

That being said, Hinman cautioned that "the analysis of whether something is a security is not static and does not strictly inherent to the instrument," and that "even digital assets with utility that function solely as a means of exchange in a decentralized network could be packaged and sold as an investment strategy that can be a security."

He also pushed back on token sales which claim to be utility tokens and not security tokens, saying "Let me emphasize an earlier point: simply labeling a digital asset a 'utility token' does not turn the asset into something that is not a security."

William Hinman image via Yahoo! / YouTube

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