Regulation
US cryptocurrency regulation promotes “useless” tokens.
Ethereum co-founder Vitalik Buterin has criticized the U.S. regulatory approach to cryptocurrencies, particularly the consistent classification of utility tokens as securities.
Buterin argues that this approach discourages meaningful crypto projects and promotes the creation of “useless and vague” tokens.
Buterin supports balanced regulation of cryptocurrencies to foster growth
The co-founder of Ethereum believes that the current regulatory regime has put well-intentioned cryptocurrency developers in a tight spot. Buterin says this approach is damaging to the cryptocurrency industry and could lead to anarchy or tyranny.
“If you do something pointless, or something where you ask people to give you money in exchange for vague references to potential returns, at best, you’re free and clear, but if you try to give your clients a clear story of where their returns come from and promise what rights they have, then you’re screwed because you’re ‘a safety‘,” Buterin said.
Instead, he envisions a future where issuing a token without providing a clear long-term story for its economic value is riskier, while projects that provide such a story and follow best practices are safe. However, achieving this requires “good faith commitment from regulators and the industry.”
“I would much rather see us move to the opposite situation, where issuing a token _without_ providing a clear long-term story as to why it will maintain or increase its economic value is the riskiest thing, and if it _gives such long-term value history and follow basic best practices, then you are safe,” Buterin observed.
To know more: Ethereum (ETH) Price Prediction 2024/2025/2030
Buterin’s stance resonates with many industry leaders who have criticized the U.S. government’s handling of the emerging cryptocurrency industry. Advocates are pushing for regulations tailored to the unique nature of decentralized and cryptocurrency platforms. They believe this approach is critical to safeguarding investors and fostering technological growth without imposing undue restrictions.
However, the SEC led by Gary Gensler has consistently criticized industry participants for failing to adhere to existing regulations. Laws on titlesFor this reason, the financial regulator has declared major cryptocurrencies such as Solana and Cardano securities. Additionally, it has filed lawsuits against major cryptocurrency companies such as Coinbase, Binance, and Kraken for their cryptocurrency products allegedly violating local laws.
To know more: Who is Gary Gensler? Everything to know about the SEC president
These issues have made cryptocurrencies a significant political topic in the upcoming November elections. Cryptocurrency companies are donating to cryptocurrency-related political associations to support cryptocurrency-aligned candidates. These efforts produced significant results, with former President Donald Trump’s support for cryptocurrencies strengthening his position in the election.
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