The war on crypto continues as potential Ethereum regulation causes the coin to drop nearly 6% on Tuesday.
Government bodies have been dancing around the concept of whether cryptocurrencies are securities or commodities for quite some time now. The US Securities and Exchange Commission (SEC) has long been adamant that cryptocurrencies are securities and therefore require regulations. The SEC released a statement at the beginning of March labelling cryptocurrencies as securities and informing all crypto exchanges that they would need to register with the SEC for proper regulation.
It didn’t stop there though. The SEC wanted to apply securities laws not only to tokens and exchanges but also to crypto wallets.
On the other hand, the Commodity Futures Trading Commission (CFTC) decided to label cryptocurrencies as commodities – so, which is it?
Ethereum Regulation Crackdown?
The Wall Street Journal reported Tuesday that the fight continues. Both government bodies are reportedly looking into whether cryptocurrencies should follow the same rules as regular stocks. Ethereum, in particular, is now being looked at by regulators.
Ethereum (ETH), which is the second largest cryptocurrency after Bitcoin (BTC), dropped nearly 6% on the news. ETH is currently selling for $649.94, according to CoinMarketCap, so the coin has lifted somewhat but is still down by 4.98% in the past 24 hours.
The mere potential of Ethereum regulation appears to be making investors worried, and this concern may be spreading to the rest of the crypto market as well. The majority of crypto is down today, with only eight out of the top 100 cryptos selling in the green. No coin in the top 10 is showing growth at the moment.
What are regulators looking at that’s causing so much worry, not just for Ethereum regulation, but for crypto regulation on a whole? The Journal reports that regulators are considering whether founders of cryptocurrencies have control over the value of the coins. This can be thought of in terms as a company manager having influence over a company’s stock value based on their strategy and investments.
The SEC and the CFTC will be discussing the matter on Monday. What do you think will be the outcome of this meeting?
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