President of the American company Noll Historical Consulting Franklin Noll tried to prove from the history of the US Treasury, using an example from the history of the US Treasury, that cryptocurrencies can be recognized immediately as a means of payment and a security.
The financial historian’s assertion comes amid the ongoing debate over the status of cryptocurrencies. The final generally accepted answer to the question of whether a cryptocurrency is a security or not does not yet exist. Franklin Knoll, in an article published last week, argues that the US government has issued instruments that served both functions simultaneously on two occasions.
The Continental Dollar became infamous in the 18th century for its failed attempt to finance the War of Independence by issuing money. In addition to being used as currency, continental dollar banknotes were proposed to be considered securities.
Citing research by Dr. Farley Grubb, Knoll argues that the continental dollar was, by and large, a zero-coupon, low-denomination bond. However, later, the US Congress changed the original terms of redemption, devaluing these securities.
In addition to the continental dollar, the head of Noll Historical Consulting recalled the Civil War paper interest-bearing notes issued by the US Treasury.
According to Knoll, these notes were intended “to act as currency and as security.” However, unlike the failed continental dollars, interest-bearing notes were a success.
These bonds with a par value of just $ 10 paid a 5% annual rate. The holder received this interest when he transferred the banknote to the US Treasury. The notes were a success and were fully redeemed as promised by the government.
Gary Gensler, chairman of the US Securities and Exchange Commission (SEC), was recently unable to answer whether the security is Ethereum. At the same time, the SEC has been pursuing Ripple since 2020 – the company’s management is accused of selling unregistered securities worth $ 1.3 billion. In this case, we are talking about trading XRP cryptocurrency. On the other hand, back in 2019, the Commission made it clear that it did not consider Bitcoin as a security. FTX CEO Sam Bankman-Fried recently said that the properties of some crypto assets make them look more like securities.
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