Vitalik Buterin’s Disagreement with US Utility Token Approach

Ethereum Co-Founder Buterin: US Utility Token Approach is Wrong

Critical of the US government’s treatment of cryptocurrencies, particularly the persistent categorization of utility tokens as securities, is Ethereum co-founder Vitalik Buterin. The development of “useless and vague” tokens is encouraged, according to Buterin, whereas significant crypto initiatives are discouraged by this strategy.

Well-meaning cryptocurrency developers, according to the Ethereum co-founder, are trapped by the existing regulatory environment. Buterin claims that such a strategy is detrimental to the cryptocurrency sector and may eventually result in dictatorship.

If you do something useless, or something where you’re asking people to give you money in exchange for vague references to potential returns at best, you are free and clear, but if you try to give your customers a clear story of where returns come from, and promises about what rights they have, then you’re screwed because you’re ‘a security,’

Buterin

Buterin’s Warning to Crypto Entrepreneurs: Long Term Value Matters

Rather, he imagines a world in which initiatives that follow best practices and provide a clear long-term rationale for a token’s economic worth will be safe, while those that do not run the danger of failing to do so. “Good-faith engagement from regulators and the industry” is necessary to achieve this, nevertheless.

I would much rather see us move to the opposite situation, where issuing a token without giving a clear long-term story for why it will maintain or increase in economic value is the riskier thing, and if you do give such a long-term story and follow basic best practices then you’re safe,

Buterin

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