Joseph Lubin, the co-founder of Ethereum and cryptocurrency entrepreneur, believes that Ether will not be classed as a security in the United States.
Upon being asked if ETH can be classified as a security in the United States after Ethereum’s switch to a proof-of-stake (PoS) consensus architecture, Lubin responded, “I think it’s as likely and would have the same impact as if Uber was made illegal. There would be a tremendous outcry from not just the crypto community but different politicians and certain regulators.”
In September, Gary Gensler, chairman of the Securities and Exchange Commission, indicated that the blockchain’s switch to PoS may have brought ETH under regulatory scrutiny. Gensler stated that staking coins offered the investing public the opportunity to anticipate earnings based on the labour of others.
Lubin stated that he had been privy to SEC and CFTC conversations for many years. Approximately five years ago, authorities were still trying to figure out what tokens were. However, he maintains that ETH is sufficiently decentralised and cites the many use cases that do not involve it as a security.
Lubin stated that authorities appear to be focusing on a different component of Ethereum at present, saying that sources close to the activity in Washington, D.C. said that much of the attention is currently on stablecoins.
In a February 9 Twitter thread, Coinbase founder and CEO Brian Armstrong addressed rumours that the SEC was considering a ban on retail users staking cryptocurrencies.
“Staking is not a security,” he said, adding that it would be a wrong path for the U.S. if a ban on staking were enacted, pointing out that it is “a key innovation in crypto.”