The level of fear of the SEC chairman. They were afraid to classify all tokens as securities because BTC and ETH were too big by then, thus created this meaningless distinction. In real life there is no difference except number of users.
This is completely incorrect. There is a difference between:
(1) "PoopCoin" that is a copy paste of an existing cryptocurrency, repackaged with meme (!) marketing, and intentionally used for the creators to make quick money, and is bought ONLY for the purpose of flipping it for money.
(2) A serious cryptocurrency with a whitepaper, written by expert cryptographers, and serves a unique utility vs others, has a huge market cap, is used for real transactions.
Memecoins are also "collectable" and for "social interaction" without "expectation of profit but you can get profit as long as you say the magic words that it's not expected" whereas cryptocurrency is "accumulated" and used for "payment that isn't technically social interaction" and you can "expect profit and you can say you expect it". I hope that's clear
A meme coin is a subset of crypto currency stripped down to remove everything but belief or lulz.
There is no "utility" (the coin is not used to run some crypto system).
It's not attached to something that earns profits.
It's not even expected to retain value.
It's essentially a global apples to apples game. Those who are best at recognizing ahead of time what everyone else will find funny, get more money. In theory.
I also wanted to say "function", because the main distinguishing factor is that 'real' crypto assets are designed to perform some economic or financial purpose whilst memecoins are not.
> because the main distinguishing factor is that 'real' crypto assets are designed to perform some economic or financial purpose whilst memecoins are not
This seems like dressing up intent in another phrase and treating it the same. Regardless of intent, crypto currencies mark avenues of mass transfers of economic value. Introducing intent just seems like an obvious way for people pushing crypto to avoid regulation despite pushing the same venues of mass transfers of economic value. It doesn't matter if people had good intents, the behavior itself still must be punished for guidelines to make any sense.
At the end of the institution of chattel slavery in the south, the justification wasn't economic, it was moral. (At least in popular, individual conception of the discourse.) To "free" enslaved people was to release uneducated, unprepared people to the world, unprepared to take care of themselves. It was clearly a moral motivation, even if extremely misguided and bigoted. Why would we particularly care about intent here when it's more difficult to come up with a plan for this "coin" where people are not obviously misled and misguided? Surely people would push that "great businessmen" or however you term rich people are better at guiding financial policy allegedly directed by democratic control. (Certainly, crypto offers basically no democratic control outside of control of crypto itself.)
> Certainly, crypto offers basically no democratic control outside of control of crypto itself.
"For the hardcore neo-reactionaries, democracy is not merely doomed, it is doom itself. Fleeing it approaches an ultimate imperative. [...] Predisposed, in any case, to perceive the politically awakened masses as a howling irrational mob, it conceives the dynamics of democratization as fundamentally degenerative: systematically consolidating and exacerbating private vices, resentments, and deficiencies until they reach the level of collective criminality and comprehensive social corruption. The democratic politician and the electorate are bound together by a circuit of reciprocal incitement, in which each side drives the other to ever more shameless extremities of hooting, prancing cannibalism, until the only alternative to shouting is being eaten."
What "economic or financial purpose" does bitcoin provide that could not be identically claimed by any "memecoin"? It's entire claim was to be a "payment network" that required no organization or anything behind it. This is equally true of any memecoin. People trade DOGE coin even though it was SUPPOSED to be meaningless.
Plenty of memecoins have literally been the bitcoin code with a few strings and numbers changed.
I think a way to look at it, from an SEC trying to do their job in a pragmatic manner, is 'a crypto currency is likely to be run by professionals, a memecoin is likely to be run by teenagers'.
SEC deals with oversight and regulation actions/cases against obstinant defendants all the time. That is hard because those folks know the law.
Trying to deal with a teenager or influencer who doesn't even have a concept of the securities law is not something they do regularly. It doesn't fit with their system of function, and would likely become an absolute doom spiral of wasted time and distracted effort. Imagine trying to do a deposition where every other response is 'skibidi'. Even if it worked what are they going to collect or recover? Other meme coins?
In short: Setting aside the fundamental logic of this position, the SEC is built to battle with Bobby Axelrod, not Huawk Tua girl and those are fundamentally different skillsets.
Just like the SEC handles stock exchange fraud and not door to door snake oil fraud ?
I guess that since some memecoins are now handled by high visibility people, the amount of fraud will soon be higher than securities fraud, especially since no entity deals with it.
