SEC Spokesman Says Ethereum and Bitcoin Are Not Securities: Markets Rally in Relief

A SEC spokesman has stated in a recent speech that Bitcoin (BTC) and Ethereum (ETH) are not securities, however, ICOs are securities and they are therefore under the regulatory purview of the SEC. Bitcoin's and Ethereum's higher level of decentralization was cited as the reason why they were not classed as securities.

At the Yahoo All Markets Summit: Crypto conference in San Francisco, William Hinman, a SEC regulatory spokesperson explained in a speech that the biggest challenge in deciding if cryptocurrencies and ICOs are securities is whether there is an expectation of profits from a third party. Also if the investors in the cryptocurrency have an expectation of profits the asset could be classed a security. He stated:

"Central to determining whether a security is being sold is how it is being sold and the reasonable expectations of purchasers,"

William Hinman

Hinman explained that the higher the level of centralization the greater chance of the cryptocurrency being classed a security. He explicitly said Bitcoin was not a security due to its high level of decentralization, and went on to add that Ethereum was not a security for the same reason.

Relief for Ethereum Ecosystem

Industry experts already believed Bitcoin to not be a security, however there was significant uncertainty over how the SEC would class Ethereum. It raised $18 mln in 2014 via an ICO which worried many investors who thought it would be in breach of the relevant US securities laws.

Due to the large number of Ethereum ICOs and DApps, its status as a security has long been a source of doubt for the entire Ethereum ecosystem of ICOs and DApps that rely on Ethereum. According to CryptoCompare data the markets have reacted strongly to the news and in under 1 hour Ethereum has risen 10% to over $520.

Ethereum (ETH) CryptoCompare

Bitcoin’s Price Should Now Be Over $100,000, According to John McAfee's 2020 Prediction

Francisco Memoria

The price of bitcoin should now be of over $100,000 to follow the price prediction of eccentric cybersecurity expert John McAfee, which claimed it would be at $1 million by the end of 2020.

According to a website tracking the performance of the flagship cryptocurrency against McAfee’s prediction, BTC is currently down by 90% against where it should be to follow the price prediction.

Currently, one bitcoin is changing hands for around $10,150, but according to McAfee’s prediction it should be at around $102,500.

A graph of BTC's price vs. McAfee's predictionSource: Bitcoin Price Prediction Tracker

McAfee’s prediction was made back in 2017 when the cryptocurrency was trading at little over $2,200. The website adds BTC had to steadily grow at a rate of 0.484% a day to get to $1 million. The initial prediction foresaw a $500,000 bitcoin by the end of 2020, but McAfee revised it as his initial modes “predicted $5,000 at the end of 2017.”

BTC got a high of nearly $20,000 before the end of 2017, but soon started dropping. Over 2018 it went down to a $3,200 low before recovering in what has become known as the “crypto winter.” McAfee has been standing by his $1 million price prediction as time goes on, despite the 2018 bear market.