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No counterparty? The Eth network is the counterparty, you're buying a stake in the network, you are diluting everyone's control. And earning a reward.
by neffo 4y ago
No counterparty? The Eth network is the counterparty, you're buying a stake in the network, you are diluting everyone's control. And earning a reward.
- yokem55 4y agoOne does not automatically earn a return just by staking eth. A validator with a node has to be operated which performs the validation and block proposal functions, and money is only made when those activities are performed. The eth that is deposited is not an investment - it is a bond for good and honest performance of the work. Now, there are services that perform those activities on behalf of others, and some of those arrangements could possibly be labeled as securities, but on it's own, at the base layer, participating in eth's proof of stake system is not a security.
- LatteLazy 4y agoPersonally, I really dislike the idea of a decentralised counterparty but for eth I can see the argument at least. Of course, you could make the same argument about mining gold: it's a security because you are taking profit by diluting the overall global gold supply network... But for BUSD, none of this applies: you cannot mine it, control is absolutely with Paxos, and is undiluted and the price is (in theory) fixed.