Could Dogecoin become a security if Elon Musk integrates Twitter as a native currency? Lawyer weighs in
There is a chance Dogecoin (DOGE) will feature prominently in the proposed Twitter digital payments.
Pro-crypto Attorney John Deaton says Twitter might get in SEC’s crosshairs if DOGE becomes the primary crypto on Twitter.
Since the acquisition of Twitter by the social media-savvy billionaire, Elon Musk, there have been claims that the microblogging site is on track to pivot into digital payments. In recent times, the California-based company has reportedly set up a new team to develop the product, and cryptocurrencies are tipped to feature as an integral part of the payment system.
Considering the fondness Musk has for the most popular memecoin Dogecoin (DOGE), there are insinuations that the digital currency will take a frontline role in the new Twitter feature. Herein lies the dilemma as a pro-crypto lawyer, John Deaton pointed out the likelihood of the company getting into the crosshairs of US regulators.
Taking to Twitter, Deaton created a hypothetical scenario whereby Twitter eventually secures the approval to offer crypto payments and allowed only Dogecoin. According to the vocal lawyer, this move can notably push the United States Securities and Exchange Commission (SEC) to come after the firm as it might tag DOGE tokens as securities.
The SEC is known to be quite erratic in how it files lawsuits against players in the digital currency ecosystem. The regulator has been in a legal brawl with blockchain payments firm, Ripple Labs Inc since December 2020. The lawsuit was filed at the time when the former SEC Chairman Jay Clayton was preparing to make his exit from the commission.
The SEC claimed at the time that Ripple sold XRP coins as unregistered securities and raked in about $1.3 billion in sales at the time. As the case has evolved over the years, many are now tipping the blockchain payments firm to win the regulator considering the merits of the firm’s arguments.
Dogecoin: Will Twitter face the same plight as Ripple?
Considering Elon Musk’s history with the SEC, there is a likelihood that the billionaire investor will do all he can to prevent an additional Dogecoin (DOGE) fueled brawl with the new Twitter company.
It is worth noting that there are reports the social media platform is losing ad revenue. Notably, it was claimed that the firm’s biggest advertisers pulled out citing the misdirection of the firm’s new content moderation policies. The attempt to diversify its revenue generation models accounts for one of the reasons why Twitter is pivoting into the digital payments sector.
Based on this, the chances that the firm will rile the regulator by singling out DOGE as the only supported crypto in its payment push is somewhat unlikely. Dogecoin has goodwill in the broader Web3.0 ecosystem and has wide acceptability amongst millions of users.
The coin’s use case is generally tagged as a payment utility, supporting it alongside Bitcoin (BTC) and Ethereum (ETH) will strengthen its chances of not crossing regulators’ crosshairs.
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Filed under: Bitcoin - @ February 2, 2023 4:04 pm