Ethereum co-founder and ConsenSys founder Joseph Lubin is confident that ETH will not be classified as a security in the United States, despite concerns raised by the Securities and Exchange Commission Chairman Gary Gensler. In a recent interview at the Web3 event, Building Blocks 23 in Tel Aviv, Lubin compared the possibility of ETH being declared a security to “if Uber was made illegal.”
Ethereum’s Decentralization Debated By Regulators
According to Lubin, he has been involved in talks with the SEC and the Commodity Futures Trading Commission for a number of years, and initially, the regulators thought that all tokens were securities.
Additionally, Gensler had previously suggested that Ethereum’s transition to a proof-of-stake (PoS) consensus model could bring ETH under the SEC’s jurisdiction.
However, Lubin believes that ETH has sufficiently decentralized, with numerous use cases that do not implicate it as a security. Lubin also noted that the court system in the United States would likely support arguments that ETH is not a security.
At the moment, Lubin believes that regulators are more focused on stablecoins and the potential impact they may have on the market. This sentiment was echoed by Coinbase founder and CEO Brian Armstrong, who responded to rumors of a potential ban on retail consumers staking crypto, stating that staking is not a security.
Armstrong also called for clear rules and sensible solutions to be established in the industry to protect consumers while preserving innovation.
According to Armstrong’s statement:
We’re hearing rumors that the SEC would like to get rid of crypto staking in the U.S. for retail customers. I hope that’s not the case as I believe it would be a terrible path for the U.S. if that was allowed to happen.
Armstrong’s tweet comes on sight when in an interview, the CEO of a leading Israeli cryptocurrency service provider, Ilan Sterk of Altshuler Shaham Horizon, raised concerns over the potential negative effects of Israel’s proposed classification of cryptocurrencies as securities. According to Sterk, this classification could harm the local crypto industry in the country.
Nevertheless, despite concerns raised by regulators, Lubin remains confident that Ethereum will not be declared a security in the United States. He believes that the decentralization of ETH and its numerous use cases will be sufficient to support arguments in favor of its non-securities classification.
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