Ethereum Jumps On SEC Director Remarks
A high-ranking official at the U.S. Securities and Exchange Commission (SEC) has said that Ethereum is not to be considered a security, and therefore does not fall under the jurisdiction of the US financial regulator.
The remarks were made by director of corporate finance William Hinman at the SEC, speaking at the Yahoo Finance All Markets Summit: Crypto in San Francisco on Thursday.
Markets reacted by pushing ETH price up by around 10%:
“When we think about how ether today is operating, at least, we see a highly decentralized network, and not the type of centralized actor that characterizes securities offerings,” Hinman explained, while adding that, “in its current state, we don’t see value regulating it.”
The remarks appear to contradict earlier statements by the SEC that all initial coin offerings (ICOs) are essentially securities. The Ethereum platform and its cryptocurrency ether first came to life after an ICO in 2015.
However, as the SEC stressed on its website the Hinman’s speech “expresses the author’s views and does not necessarily reflect those of the Commission, the Commissioners or other members of the staff.”
According to former Commodities Futures Trading Commission (CFTC) Chairman Gary Gensler, both Ethereum and Ripple XRP were near the top of the list of cryptocurrencies to be labelled as “non-compliant securities” as it relates to US securities regulations. With Ethereum now getting some breathing space, it appears Ripple XRP is the main contender left to be subject to more US regulatory scrutiny going forward.