The Belgian financial police officer, the Financial Services and Markets Authority (FSMA), has published a document in which it specifies that Bitcoin (BTC) and Ether (ETH) should not be considered transferable securities. Furthermore, a blockchain’s consensus does not affect this plan to assess a cryptocurrency’s rating.
ETH and BTC are not securities
The Financial Services and Markets Authority (FSMA), the equivalent of the AMF in Belgium, has published a clarification on how digital assets should be classified. Considering the elements in this document, Bitcoin (BTC) and Ether (ETH) cannot be classified as securitiesjust like company shares, for example.
This is in contrast to the comments of Gary Gensler, the chairman of the Securities and Exchange Commission (SEC). The latter indeed had suggested that ETH was a security since moving to proof-of-stake (PoS).
While he had not explicitly mentioned ETH, he had said so on Merge Day digital assets operating on a PoS model enabled strikers to know their performance in advance. That’s what he means may agree with Howey’s testwhich is a test to judge the classification or not in securities.
But the FSMA’s approach is different, according to it it is rather necessary to go to the source, in the way a cryptocurrency is spent :
“If there’s no publisher, like in cases where the instruments are made by computer code and stuff was not created under an agreement between the issuer and the investor (e.g. Bitcoin or Ether), then in In principle, the Prospectus Regulation, the Prospectus Act and the MiFID code of conduct do not apply. »
👉 To continue – Find our guide to buying Bitcoin (BTC)
The best way to secure your cryptocurrencies 🔒
🔥 Up to $30 in Bitcoin offered by purchasing a Ledger
A technologically neutral approach
The FSMA was particularly clear in the introduction to its plan and stipulated it its approach was unaffected by the underlying technologythus excluding the debate”proof of work/proof of commitment»:
“The step-by-step plan is technology neutral. The qualification as a security, a financial instrument or an instrument investment does not depend on the technology used. »
None of this means that BTC and ETH are exempt from rules, but they will differ depending on how the players in the ecosystem will use these assets.
Otherwise, some cryptocurrencies should indeed be interpreted as securities. Among other things, the plan presented lists three very explicit conditions to which many projects are attached:
“The funds raised are used for the general funding of the channel and the service or project has not yet been developed. The instruments are used to reward staff. The issuer organizes several sales rounds at different prices. »
Therefore, this clarification of the Belgian financial policeman is important, because as a European player this understanding is could serve as a reference in the Union.
👉 Also in the news – Is global cryptocurrency regulation in the works?
Join Experts and a Premium Community
PRO
Invest in your crypto knowledge for the next bull run
Sources: FSMA, The Wall Street Journal
Newsletter 🍞
Receive a summary of crypto news by email every Monday 👌
What you need to know about affiliate links. This page presents assets, products or services related to investments. Some links in this article are affiliates. This means that if you buy a product or register on a site from this article, our partner pays us a commission. This allows us to continue to provide you with original and useful content. There is no impact on you and you can even get a bonus by using our links.
Investing in cryptocurrencies is risky. Cryptoast is not responsible for the quality of the products or services presented on this page and cannot be held responsible, directly or indirectly, for any damage or loss caused by the use of any good or service mentioned in this article. Investments related to crypto assets are inherently risky, readers should do their own research before taking any action and only invest within the limits of their financial capabilities. This article does not constitute investment advice.
AMF recommendations. There is no guaranteed high return, a product with a high return potential entails a high risk. Taking this risk should be in line with your project, your investment horizon, and your ability to lose some of this savings. Do not invest if you are not prepared to lose all or part of your capital.
To continue, please read our Financial Condition, Media Transparency and Legal Notices pages.
At the end of 2018, I timidly discovered the world of blockchain during my quest for financial freedom. Initially moderately invested, it was only two years later that I took the gamble to bet everything on the movement that was taking shape at the time. I then dedicate 2021 to training myself better to acquire more knowledge and seriousness. As I often say: I still have a billion things to learn. And what I do know, I want to share with you.
Vincent mayor
380 articles