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New Comment by SEC Chairman Regarding the use of Ethereum as a Security
Editorial Team

In mid-June 2018, SEC Commissioner William Hinman, publicly stated that Ethereum (ETH) was not a security. Hinman, who is the Divisional Head of Corporate Finance at the regulatory body, made the remarks at the Yahoo All Markets Summit in San Francisco.

He stated exactly:

“And putting aside the fundraising that accompanied the creation of Ether, based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions.”

On September 13, the SEC Chairman, Jay Clayton, has come out to clarify the comment of the first as non-binding to the authority and not to be considered law.

He said:

“The Commission’s longstanding position is that all staff statements are nonbinding and create no enforceable legal rights or obligations of the Commission or other parties.

Statements issued by SEC staff frequently include a disclaimer underscoring the important distinction between the Commission’s rules and regulations, on the one hand, and staff views on the other.”

The Chairman continued saying that the authority will make an effort to point out the comments of its employees should not be taken as concrete declarations by the Authority.

“As we carry out our market oversight functions, I believe we at the Commission should keep this important distinction in mind.  Several weeks ago, I instructed the directors of the Division of Enforcement and the Office of Compliance Inspections and Examinations to further emphasize this distinction to their staff.”

According to the publication from ethereumworldnews.com, the Director’s Hinmans’s comments were accompanied by a disclaimer stating that his words were his opinion and separate for those of the SEC.

The clarification by the SEC Chairman is in tandem with the observation Ethereum World News made last month – due to the keen eyes of the XRP community who kept pointing it out as part of their efforts to extinguish the FUD against the digital asset. This FUD appears XRP as the most centralized and manipulated cryptocurrency.

With a few pending court cases against Ripple still to be concluded, we can say that the comments of SEC Chairman Clayton give the Ripple company some leverage in its defence against the standing charges that it is issued an unregulated securities offering.