According to the CoinTelegraph’ s new, Jay Clayton confirmed that Ethereum (ETH) is not a security:
United States Securities and Exchanges Commission (SEC) Chairman Jay Clayton confirmed that Ethereum (ETH) and cryptocurrencies like it aren’t securities under U.S. law, non-profit crypto research organization Coin Center reports on March 12.
This is a very big new for the cryptocurrency market especially for ETH holders and traders. So what is a security?
What is a Security?
A security is a certificate or other financial instrument that has monetary value and can be traded.
Generally, securities are traded on secondary market.
Securities are readily traded which means they’re liquid.
They are easy to price, and so they can show the value of an asset.
How it works?
If you are buying a security, it comes under the compliance of SEC (in the USA) and who offers the security, has to be registered with SEC.
Banknotes, Bonds and Stocks etc.
Why is it important for Ethereum?
First of all, now, there are no concerns about holding or trading Ethereum.
Investors were skeptical about the future of Ethereum as they see SEC as a threat.
As it is clear that Ethereum is not a security, now, there is nothing to be scared.
As SEC’s involvement may affect the price in a good way, it may also lower the price.
SEC’s decision can change the way of a cryptocurrency and this can be a risk for an investor.
In my opinion, this decision will boost the price in the long term.
Now, everything is clear and there won’t be a manipulation about this subject.
Moreover, projects that do not want SEC’s involvement will use Ethereum Blockchain which can bring a huge adaption.
As a result, we may see some price movement soon.