Protocol Labs Rebuts SEC Allegations: Filecoin Is Not a Security
- According to Protocol Labs, Filecoin is a worldwide storage network fueled by cryptocurrencies, not securities.
- In response to the SEC’s definition of FIL in its enforcement proceedings against exchanges, the company emphasized the need for numerous Filecoins.
- It further noted that several politicians, including members of the US House, have declared openly that Filecoin is not a security.
Filecoin is one of several coins named on the list of coins and tokens listed as securities by the U.S. Securities and Exchange Commission (SEC). The allegations were made during the SEC’s battles with Binance and Coinbase, and Protocol Labs spoke out on the matter.
On June 9, Protocol Labs, the Filecoin development company, issued a statement on Twitter:
“Filecoin is a cryptocurrency-powered global storage network preserving humanity’s most important information, not a security.”
The Filecoin network contains over 3,500 storage provider systems in 40+ countries, resulting in over 33 million storage agreements, thousands of GitHub contributors, and 300+ organizations developing tools and apps on the Filecoin network. The FIL utility token is fundamental to the network’s functionality. FIL is used as transaction gas, as compensation for storage providers, and as a technique to assure data storage reliability. According to Protocol Labs, this has enabled the network to manage over 1 billion transactions.
Protocol Labs continues to provide reasons to support its perspective, such as the fact that hundreds of separate storage providers contribute over 12 EiB of storage capacity worldwide and that more than 1.0 EiB of data is stored. Every day, around 4.5 PiB of data is contributed to the Filecoin network. Filecoin storage providers (SPs) determine their own rates, providing data owners with a cost-effective and fully customizable storage solution. The cost of storing data on the Filecoin Network is much lower than the cost of storing an identical quantity of data on AWS or Google Cloud.
Protocol Labs cited the importance of multiple Filecoins in response to the SEC definition of FIL in its enforcement actions against exchanges and emphasized that many policymakers, including members of the US Congress, have publicly stated that Filecoin is not a security. In addition, the company behind Filecoin alss asserted that it is purely a technology:
“We are glad many policymakers, including members of U.S. Congress, have publicly stated Filecoin is not a security. Filecoin is not an investment contract; it is a foundational technology for the future of the Web.”
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