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Blog

Date:
12th Oct 2020
Author:
CryptoAltum Analytics Team

SEC Commissioner says UNI, YFI, and DeFi Tokens May Be Securities 

Hester Peirce, one of the four commissioners for the Securities and Exchange Commission (SEC), in a LA Blockchain Summit, warned that Ethereum’s DeFi governance tokens are not necessarily “outside the scope of securities law.” Although she avoided specific assessment of projects, she urged creators to “talk with the regulator” on how they intend to distribute its tokens.


Details: 

DeFi growth has been tremendous. Open finance dApps have assets exceeding $9.5 billion under management. Most of these dApps have re-distributed their governance tokens to their respective communities. That they may be securities could be a shocker for holders who may have to dump them should the regulator crack the whip. 


Impact on the ETH Price: 

Bearish. The SEC and regulators across the world especially in China and SE Asia were directly responsible for the ETH price deflation in the great crypto winter of 2018. If the SEC goes after DeFi and its governance tokens, ETH prices will likely tank even if Eth2 is successful.


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