Vitalik Buterin defends Ethereum ahead of merge; ‘not a security’
Ethereum co-founder Vitalik Buterin tweeted a defense of the network’s transition to proof of stake (PoS) on Tuesday, responding to arguments suggesting assets secured by such consensus mechanisms are a security.
See related article: Ethereum one step closer to Eth2 with Ropsten testnet merger
Fast facts
“The fact that you can vote on something to change its properties is proof that it’s a security,” Swan Bitcoin managing editor Nick Payton said on Tuesday, signing “love Bitcoin” as a nod to the proof-of-work (PoW) consensus mechanism.
Buterin dismissed this claim as an “unmitigated bare-faced lie,” adding PoS does not include voting on protocol parameters, nor does PoW.
Ethereum is scheduled to ditch its current PoW consensus mechanism in August by merging the PoS Beacon Chain with the existing chain as a significant part of the long-running transition to Ethereum 2.0.
Both PoS and PoW are methods for how networks are validated; in PoW, the probability of mining a new block is determined by how much computational power is done by the miner, whereas PoS rewards miners according to how much they have staked to the network.
Regulators have been accelerating into the crypto space since the Terra-LUNA crash, with U.S. lawmakers proposing a bill that places significant emphasis on the classification of cryptocurrencies as commodities or securities.
U.S. Securities and Exchange Commission (SEC) chair Gary Gensler — who has been pushing for classification of most cryptocurrencies as securities — recently doubled down on his statement that classifies Bitcoin as a commodity.
See related article: Vitalik Buterin: Why Eth2 will propel Ethereum’s use in enterprise