Why Can Classifying ETH as a Securities Have a Negative Impact?

Bittime - The cryptocurrency world is being shocked by reports that mention the potential for the United States Securities and Exchange Commission ( SEC ) to classify Ether (ETH), the native token of the Ethereum platform, as a security. 

It is feared that this move will have a significant impact on the future of Ethereum and the cryptocurrency market as a whole. Let's lay out some of the arguments against classifying ETH as a security.

Negative Impact of Classifying ETH as a Securities

Classifying ETH as a security could have adverse consequences for various parties:

• Businesses and Investors: Many businesses have integrated with the Ethereum network, including well-known crypto exchanges. Classifying ETH as a security could result in strict regulations that make it difficult for such businesses to operate. Additionally, investors currently holding ETH will face additional regulation and a potential decline in the value of their investment.
• Ethereum Ecosystem: The fast-growing Ethereum ecosystem can be hampered by heavy regulations. The development of decentralized applications ( dApps ) and other innovations on the Ethereum network may be hampered.

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Arguments Against Classifying ETH as a Securities

Crypto law experts argue that ETH does not meet the criteria as a security for several reasons:

Ethereum is a Decentralized Network

Unlike traditional securities that are controlled by a single entity, Ethereum is a decentralized network that has no central authority.

ETH Has a Utility Function

ETH not only serves as an investment, but is also used to pay transaction fees on the Ethereum network. This utility function differentiates them from traditional securities.

No Expectation of Profit

ETH investors have no hope of profiting from other people's efforts. The value of ETH is determined by market factors, not by the performance of a particular company.

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Previous Case: No Reference to ETH

The SEC has never explicitly classified crypto assets like ETH as securities. Some experts argue that the SEC's decision regarding The DAO in 2018 cannot be used as a reference for ETH because The DAO has a different structure.

Conclusion

Classifying ETH as a security is a controversial move that could negatively impact the growth of the Ethereum ecosystem and the cryptocurrency market as a whole. Strong arguments exist for why ETH should not be categorized as a security, primarily due to its utility function and the lack of a central entity controlling the network. Investors and industry players need to continue to monitor developments related to this regulation and hope for a fair and appropriate decision from the SEC.

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How to Buy Ethereum (ETH) on Bittime

You can buy and sell  Ethereum (ETH)  in an easy and safe way via  Bittime . Bittime is one of the best crypto applications in Indonesia which is officially registered with Bappebti. 

Ethereum (ETH)  is available on Bittime with the market pair  ETH/IDR .  To be able to buy  ETH/IDR  at  Bittime,  make sure you have registered and completed identity verification. Apart from that, also make sure that you have sufficient balance by depositing some funds into your wallet. For your information, the minimum purchase of assets on  Bittime  is IDR 10,000. After that, you can purchase crypto assets in the application. 

Learn the complete guide on how to buy Ethereum (ETH) on Bittime. 

Monitor price chart movements   for Ethereum (ETH) ,  Bitcoin (BTC) ,  Solana (SOL)  and other cryptos to find out today's crypto market trends in real-time on Bittime.

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DISCLAIMER : This article is informational in nature and is not an offer or invitation to sell or buy any crypto assets. Trading crypto assets is a high-risk activity. Crypto asset prices are volatile, where prices can change significantly from time to time and Bittime is not responsible for changes in fluctuations in crypto asset exchange rates.