Share:
  • Charles Hoskinson criticized the SEC for giving Bitcoin a “free pass” while other crypto assets are treated as securities.
  • The Cardano founder noted that BTC is not decentralized, as it would take merely three subpoenas to perform a 51% attack on the network.
  • Upon being highlighted that the ADA’s ICO is the reason Cardano is treated as a security, Hoskinson stated that it did not have an ICO.

Cardano is known as the third-generation cryptocurrency and, at times, even the "Ethereum killer" but never as “not a security”. For that matter, the Securities and Exchange Commission (SEC), to date, has only named Bitcoin as "not a security," and XRP partially won that label following its lawsuit win. This seemingly did not sit well with Cardano founder, Charles Hoskinson.

Charles Hoskinson criticizes the SEC

Cardano founder Charles Hoskinson, during a recent stream, took on the SEC for giving Bitcoin essentially a free pass by not scrutinizing it as security the same way it does with other crypto assets. Hoskinson stated,

"Explain it to me [the difference between Bitcoin and other cryptocurrencies] like I am a five years old. Run the Howey test.

He went on to add that Bitcoin is not as decentralized as the SEC believes it to be. The reason is that over 51% of the hash rate can be controlled merely by subpoenaing the top three hash pools.

In response, crypto influencer Adam Black stated that the reason behind Bitcoin not being secure is that it did not do an ICO (Initial Coin Offering). He added,

"Bitcoin did not do an ICO, most people thought it had no value, it was mined from zero, it is decentralised, there is no CEO, ICO warchested "foundation", incorporation etc. so cardano, eth etc clearly pas howey, Bitcoin is a commodity and does not.

ICOs are a form of crowdfunding where cryptocurrencies are sold to investors in the form of tokens. The ICO boom of 2018 was one of the biggest driving factors of the bull run noted back then.

Hoskinson replied to Adam's statement by saying that Cardano did not do an ICO. He noted,

"There was an airdrop onto a distribution, and then thousands of people who never met each other traded Ada on exchanges and used Cardano for their projects.  

A voucher sale of a different asset outside of the United States, priced in Yen, settled in Bitcoin, explained in Japanese to Japanese citizens, and without a single US participant does not constitute an ICO of Ada.

Technically, Cardano did conduct an ICO by utilizing a novel variation. As stated on Cardano's official website discussing the genesis of the chain, the ADA vouchers were sold by a Japanese corporation and its sales force in Japan with total gross sales of 108,844.5 BTC. The public sales distribution accounts for 25,927,070,538 ADA, of which 2.4 billion were distributed to IOHK, the developer of Cardano.

Thus, as long as the United States does not establish clear guidelines and regulations for the crypto industry, Charles Hoskinson and others will continue to criticize the SEC for its seemingly partial approach toward crypto assets.


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Join Telegram

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content


Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended Content

Editors’ Picks

Ethereum price scrapes $3,000 psychological threshold after 20 months, inspiring conjecture on altseason

Ethereum price scrapes $3,000 psychological threshold after 20 months, inspiring conjecture on altseason

Ethereum price has managed to test a crucial milestone for the first time in months, which is a remarkable show of strength considering Bitcoin price has hinted at a fall. This means that Ether has managed to sidestep the BTC cue.

More Ethereum News

VanEck spot BTC ETF trading volume inspires strength in Bitcoin price

VanEck spot BTC ETF trading volume inspires strength in Bitcoin price

VanEck spot BTC ETF, HODL, went parabolic on Tuesday, soaring 14X in a day. With over $258 million in trading volume today, HODL boasts a 60X product average with 32,000 individual trades. WisdomTree’s BTCW and BlackRock’s IBIT are also making headlines with skyrocketing trading volumes.

More Cryptocurrencies News

Bitcoin Price Prediction: $160 million long positions liquidated as BTC slips 2%

Bitcoin Price Prediction: $160 million long positions liquidated as BTC slips 2%

Bitcoin price has extended a leg south after trading within a range for days. While the move has harmed multiple traders, it is the first sign that the next directional bias may be finally ready to show. 

More Bitcoin News

Worldcoin price crashes 10% as AI narrative fades

Worldcoin price crashes 10% as AI narrative fades

Worldcoin (WLD) price was one of the AI tokens that benefitted the most from sector hype in February, rallying almost 270%. However, as the theme is now priced in, WLD holders appear to be booking profits en masse.

More Worldcoin News

Bitcoin: BTC eyes $60,000 but correction looms

Bitcoin: BTC eyes $60,000 but correction looms

BTC has been moving up only since January 22 but could slip into a consolidation before the next leg up. With the rate at which BTC is climbing after the ETF approval, coupled with strong fundamentals, investors should consider buying the dips before BTC hits $60,000.

Read full analysis

BTC

ETH

XRP