After the Merge event and the transfer of the Ethereum blockchain from the proof-of-work consensus to a proof-of-stake method, United States Senator Cynthia Lummis has said that Ether is now a security. This transformation occurred after the Merge event.
Sen. Lummis made this statement while participating in an interview on CoinDesk TV’s “All About Bitcoin” show. He said that “It’s a security because of the way [it] went from proof-of-work to proof-of-stake.” The fact that it is now unable to unstake tokens increases the likelihood that it will be [classified as] a security.
Sen. Lummis stated that it is beginning to seem more and more likely that the only item that would qualify as a commodity is bitcoin. Since he first heard about Bitcoin, the lawmaker has been fascinated by the cryptocurrency.
In his statement, Senator Lummis did acknowledge the possibility that ether would one day become “sufficiently decentralized that it might subsequently be called a commodity.”
Gary Gensler, the chairman of the Securities and Exchange Commission (SEC), hardened his position on proof-of-stake (PoS) cryptocurrencies being categorized as securities in September, stating that it could satisfy the Howey test, which is used by courts to establish whether or not an asset is a security.
Lummis thinks that it is reasonable for SBF, the creator of FTX, to have turned down an offer from Maxine Waters, the head of the House Financial Services Committee, to attend a congressional hearing on the failure of his exchange.
The senator is of the opinion that rather than addressing in front of Congress in an effort to repair his public image, Bankman-Fried should focus on navigating the process of filing for bankruptcy.
After the failure of FTX, Lummis has been advocating for the passage of her bipartisan measure, which is termed the “Responsible Financial Innovation Act.” She claims that the failure of FTX might have been avoided if the bill had previously been passed into law.
According to statements made by Lummis, “The sort of rehypothecation that was going on with FTX and some of the other qualities of FTX that led it to collapse would have been avoided had the Lummis-Gillibrand law been in place.”
According to Lummis, the failure of FTX has only served to heighten more emphatic support for the return of the Lummis-Gillibrand bill in the new Congress the following month.
Compiled by Coinbold