A statement issued today by the Gary Gensler, former chairman of the Commodity Futures Trading Commission has the potential of skyrocketing the prices of Ethereum and Ripple. According to Ethereum World News, both cryptocurrencies could be classed as securities by the U.S. Securities and Exchange Commission, while other top 10 coins, like Bitcoin, Litecoin, or even Bitcoin Cash probably won’t be.
Mr. Gensler, who now teaches blockchain technology at MIT said in an interview with the New York Times that he is optimistic about the future of the second and third coin of the moment, in terms of market cap.
The probability for this to happen is big
“There is a strong case for both of them — but particularly Ripple — that they are noncompliant securities.”
As for Bitcoin, he doesn’t believe that it has the same future, since it didn’t started with an ICO, like most of today’s altcoins.
“Over 1,000 previously issued initial coin offerings, and over 100 exchanges that offer ICOs, are going to need to sort out how to come into compliance with U.S. securities law,” Gary Gensler added.
He also believes that even though blockchain experiments are now in early stages, the technology could eventually replace a lot of parts of the financial industry.
Back to Bitcoin, it should also be mentioned that one of the reasons why it doesn’t have any chances of becoming a security – at least according to Gensler – is that it’s currently maintained by a decentralized group of developers. And other altcoins, like Litecoin and Monero, are in the same situation.
Ethereum and Ripple, to go through a change?
Ethereum, on the other side, could avoid the classification, as it’s now more decentralized, with nobody having complete control on its future. And let’s not forget about Ripple, which has a weaker argument: it holds most of the XRP tokens.
“XRP does not give its owners an interest or stake in Ripple, and they are not paid dividends. XRP exists independent of Ripple, was created before the company and will exist after it,” said one of the company’s spokespersons, Tom Channick.
If the Securities and Exchange Commission in the United States decides that some coins can be classified as securities, this will eventually restrict citizens from trading them on certain exchanges, but also drive down the value of the regulated coins.