Crypto Crash Looming? SEC Might Label All Cryptocurrencies Except Bitcoin as Securities

The post Crypto Crash Looming? SEC Might Label All Cryptocurrencies Except Bitcoin as Securities appeared first on Coinpedia Fintech News

The United States Securities and Exchange Commission (SEC) has intensified its altcoin crackdown, with Bitcoin narrowly escaping the regulator. The SEC Chair Gary Gensler has time and again argued that cryptocurrency projects that participated in initial coin offerings (ICOs), initial DEX offerings (IDOs), and initial exchange offerings (IEOs) are to be considered a security. 

Additionally, Gensler has argued that cryptocurrency projects with people working on their prosperity with investors hoping for profit based on their efforts are simply operating as unregistered securities.

As a result, most altcoins, including Ethereum (ETH), with development foundations behind them, are facing regulatory upheaval in the coming months. Moreover, most crypto projects are interested in United States investors since the country controls approximately 25 percent of global economic activities.

Nonetheless, some projects have begun looking elsewhere to base their companies to navigate the crypto winter. The ongoing Ripple vs SEC lawsuit has seen Brad Garlinghouse state that the company could relocate to crypto-friendly nations should the court deem XRP unregistered securities.

Reactions to SEC and Gensler’s Take on Crypto Regulations 

With the SEC already on crypto staking projects – following the Kraken exchange’s $30 million settlement – most PoS-secured blockchains like Solana, Ethereum, and Cardano, among others, are facing regulatory uncertainty. Nonetheless, Chief Policy Officer at Blockchain Associations Jake Chervinsky thinks the SEC and Gensler lack the authority to regulate all crypto. 

Notably, Chervinsky argued that the SEC and Gensler should prove their case in court against each crypto asset instead of generalizing the entire altcoin market.

Chair Gensler may have prejudged that every digital asset aside from bitcoin is a security, but his opinion is not the law. The SEC lacks authority to regulate any of them until and unless it proves its case in court. For each asset, every single one, individually, one at a time.

— Jake Chervinsky (@jchervinsky) February 26, 2023

Meanwhile, Bitcoin maximalist Michael Saylor responded to it indicating that Bitcoin is the only digital asset worth using as global money.

Consensus is building that everything in the #Crypto industry other than #Bitcoin is a security, destined to be regulated by the @SECGov. This makes $BTC the only crypto-asset suitable for use as global money.https://t.co/4XK6wWbz7G

— Michael Saylor (@saylor) February 26, 2023

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