Ethereum (ETH) Sees Market Woes as US Regulatory Hearing Looms
Cryptovest
Published May 07, 2018 09:18AM ET
Updated May 07, 2018 09:32AM ET
Ethereum (ETH) Sees Market Woes as US Regulatory Hearing Looms
Ethereum (ETH) saw unprecedented growth in the past days - but for US investors, the digital asset may soon become unpalatable. A looming hearing in New York later this Monday was set to define the status of the asset. At this point, both the Ethereum foundation and ICOs have used creative language to dispel the accusation of selling unregistered securities.
However, the final decision is at the hands of regulators, and the verdict will define the path of the markets.
https://twitter.com/WhalePanda/status/993420664769040384
After the news, ETH market prices sank a bit, to $732.80, down around 5% net in the past 24 hours.
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Ethereum may be vulnerable for the fact of performing an ICO back in 2014. Despite the registration of the Ethereum Foundation in Switzerland, the selling of ETH tokens may be seen as distributing securities, since this meant participation in the larger Ethereum project.
It is unknown how the verdict, when it becomes known, may affect the markets. Besides hampering US-based investors, Ethereum will remain accessible worldwide. And when it comes to crypto-only exchanges, there are no limitations for switching between coins.
Additionally, Ethereum has shown it is more dependent on the Asian markets, as well as on trading against the Tether (USDT) asset. Other tokens have various risk profiles, and some are not so popular with American investors.
Hence, the talks of pronouncing Ethereum a security, and holding the Ethereum Foundation responsible, may have a limited effect on prices, modified by the price pressures from Asian investors.
https://twitter.com/JamesTodaroMD/status/992797103377276929
Some go with the hypothesis that the usage of ETH tokens today is quite different from the fundraising purpose during the ICO. As a digital asset, ETH is not centrally issued, and is produced by distributed miners worldwide. The lack of a central issuer means no one is to be held accountable for Ethereum coins.
This article appeared first on Cryptovest
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