Introduction

Vitalik Buterin, the co-founder of the second-largest blockchain network has expressed his view regarding the recent myriad of legal actions directed at crypto projects. Recently, there have been a lot of actions by the US Securities Exchange Commission enforced against projects such as Solana and some exchanges including Binance. Amid this regulation spree, Buterin stated that the real competition may not be the one that exists within the decentralized space. Rather, it could be that the real competition was the centralized world.

Buterin expresses his thoughts

A good number of cryptocurrency exchanges and projects have fallen to some form of regulatory scrutiny recently. The US SEC has taken crypto enforcement actions against some blockchain and cryptocurrency projects including Solana and Cardano. Some of these actions have been linked to fraudulent activities including money laundering and war financing and have been traced to crypto wallet addresses on these exchanges.

When Buterin was asked to share his thoughts about the issue by Matt Huang, the co-founder of Paradigm, he answered:

I feel bad that Solana and other projects are getting hit in this way. They don’t deserve it, and if Ethereum ends up ‘winning’ through all other blockchains getting kicked off exchanges, that’s not an honorable way to win, and in the long term probably isn’t even a victory.

SEC and Classification debate Amid the legal actions, the absence of clear definition and classification is evidence of the fact that the regulatory sector is still a long way from properly characterizing digital assets and their properties. Regardless, some of the cryptocurrency projects that have been included in the string of legal suits include Solana, Polygon, Cardano, and BNB. Even in its famous lawsuits against Binance and Coinbase, the two largest crypto exchanges, SEC laws still lacks proper classification of these assets. The SEC had addressed SOL, the native token of the Solana network as a security, threatening its dependability

and listing on US-based exchanges. Solana Foundation, however, has refuted this classification and expressed its disagreement in a tweet. It stated that SOL is not a security while adding that it encourages policymakers to achieve legal clarity.

Ether also experienced such uncertainty when the native token of the Ethereum blockchain was classified and filed as a security in a lawsuit against KuCoin by Attorney General Letitia James. While the SEC’s former official, William Hinmar in 2018, stated that based on his understanding “current offers and sales of ether are not securities transactions”, the SEC chairman Gary Gensler when asked on a recent congressional hearing, left no direct answer as to whether the token was seen as a security or not.

Buterrin further referred to possible ideals behind these actions, noting that “the real competition is not other chains, it’s the rapidly expanding centralized world that is imposing itself on us as we speak,”. He also shared his hopes and encouraged other crypto projects a “fair outcome” in these circumstances.

Conclusion

Buterin’s statement simply reflects the concerns of many in the space. Concerns are rising as a result of regulatory challenges and the debate about classifying digital assets. Whether a cryptocurrency would be classified as a commodity or security would greatly affect its dynamics and usefulness as well as subject it to various legal implications. This is why the SEC would have to work harder at classifying the assets carefully and with clarity. Regardless, the decentralized space continues to thrive and create innovative solutions to problems.

Written by Nwogu Ihuoma

Check out our Ethereum Gas Fee App on App Store.

Check out our Ethereum Gas Fee App on Play Store.

Join the conversation on Twitter: Click here.

For media inquiries or interviews, please get in touch with us here.

About vTrader News:

vTrader News is a renowned international platform with comprehensive cryptocurrency, business, finance, technology, and entrepreneurship coverage. 

With a global readership, vTrader News provides unparalleled insights into the latest developments shaping the world of cryptocurrency, finance, and other emerging industries.

Learn More About vTrader: Click here.