What gives cryptocurrencies their value? Remains an intriguing question that even the most seasoned crypto enthusiast and regulators in various countries are still attempting to understand looking at the regulatory landscape the U.S. securities and exchange commission (SEC) has been treading a fine line between embracing and scrutinizing cryptocurrencies. The core of this debate revolves around what qualifies as a security and what doesn't in the crypto space with SEC ruling out some top cryptocurrencies earlier this year as unlicensed investment assets for investment token like Solana (Sol), Matic and Cardano (ADA) made it to SEC list of unlicensed token against coinbase users which fueled the ongoing debate over whether these digital assets should be considered securities under existing regulations.
How did people all of a sudden decided to venture into a new monetary system digital currency, created by an anonymous user who's identity still remains a mystery, why put so much trust on codes which are bound to fail any time, when we can rely on those in authority to always guide us by implementing good policies that will be of everyone's interest all these questions tend to reflect on our minds when we started exploring the crypto space these question are still asked by new users who are curious about the crypto space, I guess it all has to do with evolving (new changes) something all we need is change of what we do daily most people are probably tired of the old centralized system and their control an alternative to centralized system is the blockchain technology which crypto space are on the track to change how we value our assets getting into crypto space can be like stepping into a room filled with many puzzling questions which requires research and reviewing some resourceful information to get out of the hoax of centralization.
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In yet another twist on the 8th of October SEC have yet file another lawsuit against coinbase exchange the lawsuit contends that cryptocurrencies have no inherent value, and therefore, trading them should not be categorized as investments this was recently shared on Decrypt new crypto has no innate or inherent value SEC argues in Coinbase case
The Securities and Exchange Commission is arguing that cryptocurrencies lack any innate or inherent value
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Anything can fall under investment under SEC Howey test with the exception of cryptocurrencies a whisky, a bracelets and even a pokemon card can fall fall under investment argues SEC other than cryptocurrencies which are considered having no inherent value these has been a back and forth argument that have been ongoing for years according to most users traditional laws have not been clear and flexible when it comes to cryptocurrencies although the Howey test recognizes an investment as anything that can be sold and marketed for profit return which virtually most crypto fall under these test without any further clarification from SEC I guess we will continue to witness such arguments every year about cryptocurrencies and their inherent value.
Now the question remains does crypto have value?
What gives fiat currencies value? The fact they are legally backed by a country's authorities makes fiat stand out, crypto fail to be recognized as a legal tender, these made them to be considered as asset without value but what exactly gives them value over time with so much market trading volume which have surpassed billions and trillions dollars over the years.
Market demand and supply are inherently what makes cryptocurrencies stand out although these demands and supply can be said to be directly proportional to how users choose to value those crypto assets other factors like utility value made users to stick to a particular crypto asset these includes paying for services virtually, utility blockchain access services gives most crypto token value, bitcoin with its 21 million supply cap for most users tend to store bitcoin as a hedge against inflation by storing them for future value speculation some other reasons why most users tend to venture into to crypto space as it tend to promise high returns long term with blockchain technology being a new innovative technology most users see the brighter side of this technology and tend to bet on its growth long term with security attributed to Proof of work protocol which requires the used of miners to create new token makes users trust the whole idea of crypto space the ease cryptocurrencies provide such as cross border payment system across users from different part of the world use of decentralized finance makes it a go option for users to interact with it or to carry on transactional activities.
All the aforementioned values depends on users interest in any particular crypto asset therefore we can conclude be saying as more users interest increase on the use of cryptocurrencies it value as well appreciate over time the SEC Howey test could be a short term barrier against adoption but over time we could be recording significant growth in crypto adoption.