5 ms·

Well, Gary Gensler is on record in 2023 saying Bitcoin is not a security. So, I don't think it's accurate to say "probably all." In previous years Ethereum had

Well, Gary Gensler is on record in 2023 saying Bitcoin is not a security. So, I don't think it's accurate to say "probably all." In previous years Ethereum had also been described as not a security, but that opinion seems to have shifted with time. It's still not super clear to me why he says Bitcoin is not a security, but that Ethereum would be a security. I'm fine with whatever ruling as long as I can understand how it's being applied. I feel pretty good about considering stable coins securities. I'm less certain about NFTs since there is receipt of a (semi)tangible product. I wonder if the recent introduction of ordinals to Bitcoin will result in his opinion on BTC shifting soon, too?

kylebenzle 3y ago
Bottom line is that the founder/owner of Ethereum has said very clearly that investing in ETH is investing in the Ethereum team. Bitcoin Cash has no such "team" you invest in when buying BCH. I think thats the difference.
- SeanAnderson 3y ago
  Well, I had started the conversation about BTC not BCH. Personally, I feel that BCH has more of a team associated with it than BTC. That said, none of what we're talking about addresses the fact that, in 2018, Gensler said, quote, "Bitcoin. Ether. Litecoin. Bitcoin Cash. Why did I name those four? They’re not securities." Since then, things have changed, and now Gensler only highlights BTC as not a security. If the inflection point was various teams speaking publicly about their usage of funds, and those talking points shifted Gensler's opinion, then OK, but I am not aware of an official moment when his sentiment shifted. As another commenter highlights, it could also be the transition to POS for Ethereum, but, again, I am not aware of Gensler highlighting the transition as the inflection point and this rationale fails to explain LTC and BCH. To me, it feels like chasing opinion and public sentiment - not following rigid, established legal patterns.
  - kylebenzle 3y ago
    Isn't BTC controlled by one single very centralized group, Blockstream? I could be wrong but I thought Adam Back's Blockstream long ago hijacked the GitHub repo and took full control of that project.
    - hanniabu 3y ago
      That's correct, there's effectively no difference
    - SeanAnderson 3y ago
      It very may well be. I don't own any BTC and I had limited awareness of Blockstream until you mentioned it. I feel that this would make a stronger case for it being considered a security, though, no? And yet on September 27th 2023 Gensler reiterates Bitcoin is not a security: https://www.forbes.com/sites/jasonbrett/2023/10/01/sec-chair-gensler-clashes-with-congressman-on-bitcoin-ether/?sh=5ab3d0d470d7#:~:text=For%20Bitcoin%2C%20Gensler%20answered%2C%20%E2%80%9CI%20would%20say%20it%E2%80%99s%20not%20a%20security https://www.forbes.com/sites/jasonbrett/2023/10/01/sec-chair... I feel we're getting a bit into the weeds, though. Is your stance that Bitcoin is a security and that remarks made two months ago by the Chairperson of the SEC are misguided? Or is it that Bitcoin is not a security, but Ethereum is? If so, is that for technical reasons or just due to how it's discussed and marketed?
    - drexlspivey 3y ago
      Blockstream afaik hired a few devs and paid them to contribute to bitcoin core, first I’m hearing about a hijack of the repository
    - FabHK 3y ago
      Seems to me that one can make an argument that the following people, named in bitcoin/src/kernel/chainparams.cpp, control BTC: vSeeds.emplace_back("seed.bitcoin.sipa.be."); // Pieter Wuille, only supports x1, x5, x9, and xd vSeeds.emplace_back("dnsseed.bluematt.me."); // Matt Corallo, only supports x9 vSeeds.emplace_back("dnsseed.bitcoin.dashjr.org."); // Luke Dashjr vSeeds.emplace_back("seed.bitcoinstats.com."); // Christian Decker, supports x1 - xf vSeeds.emplace_back("seed.bitcoin.jonasschnelli.ch."); // Jonas Schnelli, only supports x1, x5, x9, and xd vSeeds.emplace_back("seed.btc.petertodd.org."); // Peter Todd, only supports x1, x5, x9, and xd vSeeds.emplace_back("seed.bitcoin.sprovoost.nl."); // Sjors Provoost vSeeds.emplace_back("dnsseed.emzy.de."); // Stephan Oeste vSeeds.emplace_back("seed.bitcoin.wiz.biz."); // Jason Maurice
cft 3y ago
Also Ethereum switched to proof of stake. Which means that the "stakeholders" (shareholders) are voting what transactions go into the ledger. Bitcoin is proof of work still.
- landemva 3y ago
  Hmmm, somewhat different than an election voting. With proof of stake, a staker eventually gets an opportunity to follow the validation rules and put some transactions in a block. If they don't properly follow the rules, they will get slashed. If they don't submit a block when it is their turn, they will get gently slashed. In proof of work it is a free-for-all with whoever has the most hashing power winning block submission more frequently. If they submit a block that doesn't follow the validation rules they keep all of their (physical silicon) hashing power and the block is ignored.
- ChadNauseam 3y ago
  A majority of bitcoin miners can also prevent transactions from entering the ledger at cost to themselves, just like Ethereum stakers. It's a misconception that Ethereum works via stakers voting the way people normally think of voting.
  - cft 3y ago
    The point is that majority mining is disassociated with the majority ownership of the underlying crypto in the pow case
landemva 3y ago
> I feel pretty good about considering stable coins securities. Take that further to airline points and Chipotle points. If the stablecoin does not provide returns to the holder, how is it an investment contract?
- lmm 3y ago
  > Take that further to airline points and Chipotle points. No-one is holding those with an "expectation of profit". Whereas essentially the only use of "stablecoins" is as investment schemes; even if someone isn't expecting the value of their stablecoin to rise against USD, they're expecting it to rise against something.
  - landemva 3y ago
    Stablecoins are supposed to be stable, and not rise or fall. There is no expectation of profit for a stablecoin like USDC. And USDC doesn't pay interest. People use it for stability and for payments.
    - lowkeyoptimist 3y ago
      Last I checked, you could get 5% interest on your USDC. Is that just something where the exchange is lending it out?
      - landemva 3y ago
        It is not the code of the USDC stablecoin paying 5%, so that reward is something else. Maybe the exchange wants to get many people sending coin to them so their asset base looks big for ... some purpose?
    - ac29 3y ago
      > USDC doesn't pay interest Coinbase, who co-founded USDC, absolutely pays interest on USDC: https://www.coinbase.com/usdc https://www.coinbase.com/usdc (they call it rewards instead of interest in an attempt to avoid regulation, but it is functionally the same thing)
pants2 3y ago
Gensler also said in 2018 that 3/4 of all cryptocurrencies were NOT securities. He likes to continuously expand his power by insisting everything is a security and falls under his jurisdiction.

kylebenzle 3y ago

Bottom line is that the founder/owner of Ethereum has said very clearly that investing in ETH is investing in the Ethereum team. Bitcoin Cash has no such "team" you invest in when buying BCH. I think thats the difference.

SeanAnderson 3y ago
Well, I had started the conversation about BTC not BCH. Personally, I feel that BCH has more of a team associated with it than BTC. That said, none of what we're talking about addresses the fact that, in 2018, Gensler said, quote, "Bitcoin. Ether. Litecoin. Bitcoin Cash. Why did I name those four? They’re not securities." Since then, things have changed, and now Gensler only highlights BTC as not a security. If the inflection point was various teams speaking publicly about their usage of funds, and those talking points shifted Gensler's opinion, then OK, but I am not aware of an official moment when his sentiment shifted. As another commenter highlights, it could also be the transition to POS for Ethereum, but, again, I am not aware of Gensler highlighting the transition as the inflection point and this rationale fails to explain LTC and BCH. To me, it feels like chasing opinion and public sentiment - not following rigid, established legal patterns.
- kylebenzle 3y ago
  Isn't BTC controlled by one single very centralized group, Blockstream? I could be wrong but I thought Adam Back's Blockstream long ago hijacked the GitHub repo and took full control of that project.
  - hanniabu 3y ago
    That's correct, there's effectively no difference
  - SeanAnderson 3y ago
    It very may well be. I don't own any BTC and I had limited awareness of Blockstream until you mentioned it. I feel that this would make a stronger case for it being considered a security, though, no? And yet on September 27th 2023 Gensler reiterates Bitcoin is not a security: https://www.forbes.com/sites/jasonbrett/2023/10/01/sec-chair-gensler-clashes-with-congressman-on-bitcoin-ether/?sh=5ab3d0d470d7#:~:text=For%20Bitcoin%2C%20Gensler%20answered%2C%20%E2%80%9CI%20would%20say%20it%E2%80%99s%20not%20a%20security https://www.forbes.com/sites/jasonbrett/2023/10/01/sec-chair... I feel we're getting a bit into the weeds, though. Is your stance that Bitcoin is a security and that remarks made two months ago by the Chairperson of the SEC are misguided? Or is it that Bitcoin is not a security, but Ethereum is? If so, is that for technical reasons or just due to how it's discussed and marketed?
  - drexlspivey 3y ago
    Blockstream afaik hired a few devs and paid them to contribute to bitcoin core, first I’m hearing about a hijack of the repository
  - FabHK 3y ago
    Seems to me that one can make an argument that the following people, named in bitcoin/src/kernel/chainparams.cpp, control BTC: vSeeds.emplace_back("seed.bitcoin.sipa.be."); // Pieter Wuille, only supports x1, x5, x9, and xd vSeeds.emplace_back("dnsseed.bluematt.me."); // Matt Corallo, only supports x9 vSeeds.emplace_back("dnsseed.bitcoin.dashjr.org."); // Luke Dashjr vSeeds.emplace_back("seed.bitcoinstats.com."); // Christian Decker, supports x1 - xf vSeeds.emplace_back("seed.bitcoin.jonasschnelli.ch."); // Jonas Schnelli, only supports x1, x5, x9, and xd vSeeds.emplace_back("seed.btc.petertodd.org."); // Peter Todd, only supports x1, x5, x9, and xd vSeeds.emplace_back("seed.bitcoin.sprovoost.nl."); // Sjors Provoost vSeeds.emplace_back("dnsseed.emzy.de."); // Stephan Oeste vSeeds.emplace_back("seed.bitcoin.wiz.biz."); // Jason Maurice

cft 3y ago

Also Ethereum switched to proof of stake. Which means that the "stakeholders" (shareholders) are voting what transactions go into the ledger. Bitcoin is proof of work still.

landemva 3y ago
Hmmm, somewhat different than an election voting. With proof of stake, a staker eventually gets an opportunity to follow the validation rules and put some transactions in a block. If they don't properly follow the rules, they will get slashed. If they don't submit a block when it is their turn, they will get gently slashed. In proof of work it is a free-for-all with whoever has the most hashing power winning block submission more frequently. If they submit a block that doesn't follow the validation rules they keep all of their (physical silicon) hashing power and the block is ignored.
ChadNauseam 3y ago
A majority of bitcoin miners can also prevent transactions from entering the ledger at cost to themselves, just like Ethereum stakers. It's a misconception that Ethereum works via stakers voting the way people normally think of voting.
- cft 3y ago
  The point is that majority mining is disassociated with the majority ownership of the underlying crypto in the pow case

landemva 3y ago

> I feel pretty good about considering stable coins securities. Take that further to airline points and Chipotle points. If the stablecoin does not provide returns to the holder, how is it an investment contract?

lmm 3y ago
> Take that further to airline points and Chipotle points. No-one is holding those with an "expectation of profit". Whereas essentially the only use of "stablecoins" is as investment schemes; even if someone isn't expecting the value of their stablecoin to rise against USD, they're expecting it to rise against something.
- landemva 3y ago
  Stablecoins are supposed to be stable, and not rise or fall. There is no expectation of profit for a stablecoin like USDC. And USDC doesn't pay interest. People use it for stability and for payments.
  - lowkeyoptimist 3y ago
    Last I checked, you could get 5% interest on your USDC. Is that just something where the exchange is lending it out?
    - landemva 3y ago
      It is not the code of the USDC stablecoin paying 5%, so that reward is something else. Maybe the exchange wants to get many people sending coin to them so their asset base looks big for ... some purpose?
  - ac29 3y ago
    > USDC doesn't pay interest Coinbase, who co-founded USDC, absolutely pays interest on USDC: https://www.coinbase.com/usdc https://www.coinbase.com/usdc (they call it rewards instead of interest in an attempt to avoid regulation, but it is functionally the same thing)

pants2 3y ago

Gensler also said in 2018 that 3/4 of all cryptocurrencies were NOT securities. He likes to continuously expand his power by insisting everything is a security and falls under his jurisdiction.