Ethereum’s Vitalik Buterin Claps Back at Bitcoin Maxis Who Mock Proof of Stake | Crypto Craft

  • Ethereum’s Vitalik Buterin Claps Back at Bitcoin Maxis Who Mock Proof of Stake

    From decrypt.co

    Vitalik Buterin is taking to Twitter to defend Ethereum’s move to proof of stake. The Ethereum co-founder took a shot at Swan Bitcoin’s managing editor Nick Payton, who argued Thursday that any cryptocurrency that powers a proof of stake blockchain—which uses validators with pledged, or “staked,” assets to verify transactions—is a security. “The fact that you can vote on something to change its properties is proof that it’s a security,” Payton said. The insult hits at a sore spot for a crypto industry that has for years battled with the Securities and Exchange Commission—and one that is ... (full story)

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Goat
Jul 12, 2022 8:31pm — Edited
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“The fact that you can vote on something to change its properties is proof that it’s a security,” Payton said.
This isn't the test of a security. Legally it's the Howey Test that defines a security, but a better way to think about it is this: if the only way to get some is to buy from the founder, or buy from someone who bought from the founder, it's a security.

BTC and ETH are not securities because anyone can use a computer and electricity to mining them. Ie you don't have to buy from Satoshi or Viltalik, or from someone who bought from them. This mineability makes them commodities.

On the other hand, the only way to get an XRP or a BNB is to buy from Garlinghouse or CZ, or from someone who bought from them. This is the way ETH started as well, but it became mineable after the founders got the lion's share.

The reason securities are so highly regulated is because they make it easy to rob unsophisticated investors. That's exactly what's been happening with the rampant unregistered securities in the crypto arena. The only use-case for these tokens is fraud.
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MarkGman
Jul 14, 2022 8:13am
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Quoting Goat
{quote} This isn't the test of a security. Legally it's the Howey Test that defines a security, but a better way to think about it is this: if the only way to get some is to buy from the founder, or buy from someone who bought from the founder, it's a security. BTC and ETH are not securities because anyone can use a computer and electricity to mining them. Ie you don't have to buy from Satoshi or Viltalik, or from someone who bought from them. This mineability makes them commodities. On the other hand, the only way to get an XRP or a BNB is to buy...
Well said!
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