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Why? Securities include a reasonable expectation of profit. Investors in a stablecoin expect their dollar investment to hold stable and remain unchanged.
by whatisweb3 4y ago
Why? Securities include a reasonable expectation of profit. Investors in a stablecoin expect their dollar investment to hold stable and remain unchanged.
- mikewarot 4y agoAccording to the internet (and the first result from google) "Securities are fungible and tradable financial instruments used to raise capital in public and private markets" It's a financial instrument, tradeable, and used to raise capital in public markets. How is a stable coin not any of these?
- whatisweb3 4y agoSEC uses Howey test to classify an asset as security, which includes “expectation of profits.”
- mikewarot 4y agoHow do people who use Stablecoins to route around regulation not expect profit?
- whatisweb3 4y agoStablecoins are used for a variety of reasons. Using them to skirt taxes or laws is a poor choice. USDC for example will freeze funds at the request of authorities, Circle's goal is to design a regulatory compliant stablecoin. A user might decide to use a stablecoin as a fast and low-fee transfer mechanism for remittances and donations, or to manage a multisignatory account, or to hedge against the falling price of a crypto asset, or for some application of escrow in a smart contract.