Can the SEC declare Bitcoin a security and destroy the market?

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Attorney John Deaton also called Bitcoin a security and warned that the SEC may soon activate the digital asset. Evan Van Ness, an Ethereum maximalist, tweeted that the Bitcoin production block is controlled by two entities.

The United States Securities and Exchange Commission (SEC) is currently in court with Ripple Labs over the security status of XRP. As the case nears its final decision, attorney John Deaton called Bitcoin a security and warned that the SEC may soon activate the digital asset. Evan Van Ness, an Ethereum maximalist tweeted that the Bitcoin production block is controlled by two entities.

MAJORITY OF #Bitcoin BLOCK PRODUCTION CURRENTLY CONTROLLED BY TWO ENTITIES

Of the last $1,000 BTC blocks, 501 were built by Antpool and FoundryUSA

Two pools control over 50% of block production!

In response, former SEC attorney John Reed Stark questioned why the asset was then not considered security requiring registration with the SEC. Stark suggested that Bitcoin is an unregistered security due to its mining centralization.

Deaton also responded that Bitcoin’s security status has been a topic of discussion in the past with some SEC officials considering it an unregistered security.

There are others at the SEC who believe the same thing. In 2015, some at the SEC argued that BTC was an unregistered security. That’s why it’s absurd for Maxis like @saylor and @maxkeiser to encourage/celebrate SEC XRP and other token actions. The SEC’s overreach is bad for the United States.

Support from Bitcoin and Ethereum maximalists at the SEC could backfire

Deaton has in the past warned that the SEC may enable Ethereum to move to proof-of-stake. His mention of Bitcoin maximalists and Ethereum supporters stems from their lack of support in the Ripple vs. SEC lawsuit. Both Michael Saylor and Max Keizer have shown their support for the SEC, with Saylor claiming that Ethereum and Ripple are committing security fraud.

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According to him, ETH and XRP are unregistered securities and should be shut down. In the past, Ethereum co-founder Vitalik Buterin also called XRP centralized. Buterin’s position is due to Ripple’s comment in a filing two years ago that Ethereum was controlled by China. In August, Buterin said that XRP had lost its protection against the Ethereum community.

Deaton, however, believes that support from the anti-Ripple community and so-called Bitcoin maximalists could come back to bite them.

The perfect picture encapsulates the danger of supporting government overreach simply because the current overreach does not involve the asset of your choice.

Brad Garlinghouse, CEO of Ripple Labs, called on the entire crypto community to support them, as an SEC victory could affect the rest of digital assets.

US congressional candidate January Walker also made a similar claim.

The world follows the actions of the United States, and how the government treats one of us takes precedence over how it treats us all. Instead of fighting each other pretending that one group is better than another, we need to work together for the right legislation.

Texas Blockchain Council President Lee Bratcher, however, thinks otherwise. According to him, the XRP pattern matches the Howey test and should be categorized as secure.

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