Are They Securities? | Blockchain and Cryptocurrency Course: What You Need to Know | 2019 | Summary and Q&A

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July 28, 2022
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Are They Securities? | Blockchain and Cryptocurrency Course: What You Need to Know | 2019

TL;DR

SEC believes Bitcoin and Ether are not securities due to their decentralization and lack of information asymmetry.

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Key Insights

  • ๐Ÿ˜ฏ Bill Hinman's speech on Bitcoin and Ether as securities is not legally binding and must be evaluated by the court.
  • ๐Ÿคจ The lack of concrete evidence and findings of facts regarding the decentralization of Bitcoin and Ether raises questions about the validity of Hinman's analysis.
  • ๐Ÿง‘โ€๐Ÿญ The SEC's position on decentralization as the primary factor in determining securities is not established precedent, leaving room for interpretation.
  • โšพ Different perspectives may argue that Bitcoin and Ether are not securities based on their decentralization, while others may argue the opposite.

Transcript

all of which brings us to the question of whether bitcoin and ether are securities remember bitcoin and ether are very different now than initial coin offerings they exist they're transacted and they're broadly used in a recent speech given in june 2018 by bill hinman the director of the division of corporation finance at the sec bill clearly artic... Read More

Questions & Answers

Q: What is the SEC's position on whether Bitcoin and Ether are securities?

The SEC believes Bitcoin and Ether are not securities because they are decentralized and do not have a promoter or issuer.

Q: Is Bill Hinman's speech legally binding?

No, speeches by SEC officials do not have the force of law. The court will make the final decision on whether Bitcoin and Ether are securities.

Q: Did Bill Hinman provide evidence to support his conclusion?

No, there is no evidence or findings of facts presented in Hinman's speech regarding the decentralization of Bitcoin and Ether.

Q: Can other cryptocurrencies use the SEC's position on Bitcoin and Ether as precedent?

It is uncertain, as the lack of factual evidence and clear articulation of the law make it difficult for other cryptocurrencies to argue their decentralization.

Summary & Key Takeaways

  • The SEC's Director of Division of Corporation Finance, Bill Hinman, stated that Bitcoin and Ether are not securities because they are decentralized and lack a promoter or issuer.

  • However, Hinman's speech is not legally binding, and the court will ultimately decide whether Bitcoin and Ether are securities.

  • The lack of concrete evidence and findings of facts regarding the decentralization of Bitcoin and Ether raises questions about the validity of Hinman's analysis.

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