Ethereum co-founder Vitalik Buterin criticized the existing regulation of cryptocurrencies in the United States as securities and proposed a path to improve it.
In a post on Warpcast, a social platform based on the Farcaster protocol, the programmer described the dilemma that current rules force project creators into.
On the one hand, the system actually encourages the creation of useless tokens and promises of uncertain profits, allowing in this case to remain outside the attention of regulatory authorities, Buterin emphasized.
On the other hand, if you provide clients with clear information about their rights and the tokenomics of the project, then the product is classified as a security with all the consequences, he noted.
“The gradient of incentives that this ‘anarcho-tyranny’ creates ultimately turns out to be worse for the space than just one of them,” Buterin said.
He expressed hope for a shift to the opposite situation, where issuing a token “without providing a clear long-term story about why it will retain or increase its value” would become a riskier proposition.
Conversely, good faith disclosure and adherence to ground rules would allow projects to remain “safe” from regulators.
“In reality, getting there will require good faith engagement from both regulators and industry,” Buterin concluded.
His message was a response to Ethereum community member Jason Chaskin, who recalled the programmer’s tweet with recommendations on combating unfair activity in DeFi. In September 2022, Buterin proposed for this at the front-end level:
- limit leverage;
- transparently inform about mandatory audits and safety checks of the project;
- limit access of users with insufficient knowledge through testing.
Let us recall that Buterin called blockchain a defense against authoritarian regimes, and Wintermute CEO Evgeniy Gaevoy criticized it because of attempts to build “planned socialism.”#Ethereum
