
Ethereum is not a security? - pjbyrne
https://prestonbyrne.com/2018/06/14/ether-is-not-a-security/
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thisisit
One of the issues with this semi-official statement has been that everyone in
the media is reporting it as SEC's official position. Example [1]

Even though the print on SEC.gov[2] clearly states:

 _This speech expresses the author’s views and does not necessarily reflect
those of the Commission, the Commissioners or other members of the staff._

And hence, the absurdity follows.

On the question of the word - decentralization. Time and again it has been
proven that major blockchain's hashing/voting powers are in hands of select
few. Example ghash.io has crossed more than 51% hashing on bitcoin network
couple of times. So, it is going to be interesting on what exactly is
decentralization and how many people does it take before a blockchain is truly
decentralized.

[1]: [https://finance.yahoo.com/news/sec-announces-ether-not-
secur...](https://finance.yahoo.com/news/sec-announces-ether-not-
security-162658147.html)

[2]: [https://www.sec.gov/news/speech/speech-
hinman-061418](https://www.sec.gov/news/speech/speech-hinman-061418)

~~~
DINKDINK
>Time and again it has been proven that major blockchain's hashing/voting
powers are in hands of select few.

Incorrect, miners produce blocks that follow users' consensus rules. Users _do
not_ follow miners' blocks. No amount of bitcoin hashing can get bcash users
to run bitcoin and vice versa.

~~~
thisisit
Pray tell - who are these users and how are they different from miners? And
how do these users vote?

~~~
DINKDINK
>how do these users vote?

Simple, by running which ever client that has the consensus rule set they
want.

>how are they different from miners?

Miners use hashing power to produce blocks that meet users' consensus rules.
Users verify these blocks meet their own consensus rules.

e.g. HashingCo uses their miners to produce a block with a blockreward of 12.5
bitcoin. In that block they include a transaction to their power supplier. The
power supplier receives the block over the p2p network, checks if it is valid
for their consensus rules, and then settles their bill. If HashingCo produces
a block with a 100 bitcoin coinbase reward, sent that block to their power
supplier, no amount of hashing will get their supplier to accept it as valid

------
DINKDINK
The SEC spokesperson probably doesn't understand that Ethereum nodes are so
centralized that no end users run them and it's even arduous for production
environments to keep them up. Given that Ethereum miners can vote for
themselves whether or not they increase the Ethereum blocksize, that reduces
their competitors which centralizes nodes+miners even more.

You can make a case that, before Ethereum was built, it is was classifiable as
a security under the Howey Test. You can also make the case that, after
Ethereum was launched, that the ether _produce while mining_ are not
securities. But what you cannot deny is that the Ethereum Foundations 70
_million_ ether that they premined(spun ether from straw) are definitely
securities.

The number of people who don't understand that there's a centralized
'foundation' holding >~65% of ethereum and the ethereum devs are trying to
shift their ecosystem to rewarding and voting on Ethereum blocks with ether is
astounding.

~~~
throwaway122378
BTC or BCH ?

