This past Friday – November 16th – the Securities and Exchange Commission (SEC) released a statement announcing that they had settled charges against two firms that had carried out ICOs that fall under securities offering. The two firms that were cited by the SEC were CarrierEQ Inc. (Airfox) and Paragon Coin Inc.
The settlement with the SEC included the following:
- Each were fined $250,000
- Each were ordered to compensate harmed investors who purchased tokens in the illegal offerings
- Both agreed to register their tokens according to the Securities Exchange Act of 1934
- They were also to file periodic reports with the Commission for at least a year
Social Media Talk That Ethereum Is Dead
After the verdict, Twitter was rife with conclusions that Ethereum was now dead. One such tweet came from Craig Wright who is also embroiled in the Bitcoin Cash Hash Wars. His exact tweet was as follows.
Any use-case for ETH no longer exists following the confirmation by the @SEC_News on ICOs. All as I have been trying to say for years.
Next target, XRP. Another illegal unregistered security platform to take down.
— Dr Craig S Wright (@ProfFaustus) November 17, 2018
Ethereum Was Simply Validated By the SEC
Craig Wright’s tweet can be understood in the context that he is trying to justify his vision of Bitcoin Cash SV being the real version of Bitcoin and Bitcoin Cash. Given the current situation of the Bitcoin Cash hash wars, it is only natural that he would conclude that Ethereum is dead given the SEC verdict on the two ICOs.
But further scrutinizing the statements by the regulatory body, we find the following words from the Co-Director of the SEC’s Enforcement Division, Stephanie Avakian.
We have made it clear that companies that issue securities through ICOs are required to comply with existing statutes and rules governing the registration of securities.
ETH is Best Placed to Tokenize Securities on Wall Street
Now here is what everyone who is bearish on ETH does not see: Ethereum is best-placed to tokenize securities on Wall Street and other global stock markets.
Evidence of why Ethereum will spearhead the blockchain revolution on Wall Street and other traditional markets can be seen through the following recent events.
- Launch of several stable coins that are ERC20 tokens: Tether (USDT), True USD(TUSD), USDCoin (USDC), Gemini Dollar(GUSD), Paxos Standard (PAX)
- The highly anticipated Constantinople upgrade that is meant to increase the throughput of the Ethereum network. High throughput is necessary to handle what the future holds
- Anticipated Ethereum Futures contracts by the CBOE exchange before the end of 2018
- The SEC asking the two ICOs to register their tokens as securities. There was no mention of ‘removing’ them from the Ethereum network. The SEC embraces technology wholeheartedly
- Austria using the Ethereum blockchain to issue Government bonds
- Additional progress in Europe to tokenize securities on the Etheruem network in a regulated manner. DESICO is one such project
In conclusion, the drop in Ethereum’s value can be taken as an overreaction to the SEC settlement with the aforementioned two ICOs. There is also the Bitcoin Cash hash wars causing a lot of uncertainty in the entire crypto market.
However, there is a glimmer of hope as the future is obvious: tokenizing securities will allow the regular individual to own a slice of large companies (Amazon, Apple, Oracle, etc) and even government bonds. Ethereum is best placed to tokenize such ownership.
What are your thoughts on the recent verdict on ICOs by the SEC? Please let us know in the comment section below.
Disclaimer:This article is not meant to give financial advice. Any additional opinion herein is purely the author’s and does not represent the opinion of Ethereum World News or any of its other writers. Please carry out your own research before investing in any of the numerous cryptocurrencies available. Thank you.