Proposed ‘Ethereum’ Investment Vehicle Sparks Controversy
Proposed ‘Ethereum’ Investment Vehicle Sparks Controversy
The non-profit Ethereum Foundation that holds the trademark for the name ‘ethereum’ said today it is “addressing” New York-based Grayscale Investments’ newly revealed Ethereum (ETC) Investment Trust proposal.
A subsidiary of Digital Currency Group (DCG), Grayscale plans for the investment vehicle to provide a means for accredited investors to gain exposure to a publicly traded digital asset called ethereum classic (ETC) by creating an open-ended titled security.
The problem: While there’s one trademark, there are two versions of cryptocurrency network bearing a variation of the name, one of which is not the so-called “official” version of the software. Following a hard fork last June that resulted from the infamous collapse of The DAO, supporters of ethereum classic continued development on ethereum’s original blockchain (ETH)
Though no actions have been taken by the Ethereum Foundation to stop ethereum classic’s use of the name, it has nonetheless been alleged that ETC’s existence contributes to confusion over which software is supported by the platform’s creators.
In this light, the announcement of the Ethereum (ETC) Investment Trust is exacerbating tensions between the two industry groups.
In spite of early efforts by influential members of the ethereum community to lend support to those who planned to build on ethereum classic, potential confusion over the trust may force their hand.
The Ethereum Foundation received the “ethereum” trademark on 27th December 2016, and a representative for the organizatoin told CoinDesk that its legal team has gotten involved, adding:
“The Ethereum Foundation is aware of this issue and is addressing it.”
Details about what exactly that response might be are not currently being revealed, but ideas about possible directions forward are beginning to emerge.
“The Ethereum Foundation has heard the concerns of the community,” the representative went on to say.
‘Nothing to rename’
At this stage, however, it remains to be seen how the situation will play out – and how much will spill over into the public domain.
In an email to CoinDesk, Digital Currency Group founder and CEO Barry Silbert downplayed concerns about the potential name confusion.
Silbert reiterated that the formal name of the trust includes the ETC designation, an abbreviation that he said clearly denotes ethereum classic, and not ether ETH, the designation for ethereum.
The founder added that the since the trust has not yet launched, “there is literally nothing to rename”.
Nevertheless, the response on social media has been strong, with influential members of the ethereum community calling for the Foundation to enforce its claims on the trademark. At press time, a social media campaign had even been launched to raise awareness of the issue.
Joe Lubin, an ethereum co-founder and founder of startup ConsenSys, went so far as to warn on Twitter that if the foundation doesn’t protect its trademark, it may lose it.
In an email sent to CoinDesk, Lubin clarified that he is not personally pursuing any action action against Grayscale.
He added that he believes a cease-and-desist letter could prove sufficient to resolve the dispute prior to the foundation taking any formal legal action.
Lubin added in a separate email:
“I and ConsenSys have no involvement. It is an Ethereum Foundation issue.”
Gray area at Grayscale
Yet, the dispute between the Ethereum Foundation and Grayscale highlights previously existing concerns that, perhaps, the trademark isn’t enforceable in this context.
In a lengthy blog post on the site of the Berns Weiss law firm in September, managing partner Jeffrey Berns reviewed the potential grounds for a dispute based on both copyright and trademark, considering that ethereum classic is actually running on the original blockchain.
Berns wrote at the time that those who “have advocated that the Foundation pursue intellectual property claims against ethereum classic, do not have a strong understanding of US intellectual property law.”
In conversation with CoinDesk, Berns, who has also taken up a fight against the IRS on behalf of Coinbase customers, argued that the Ethereum (ETC) Investment Trust “appears to have chosen its name for the purpose of causing confusion” between the two blockchains.
“As a law firm that has dedicated its practice to protecting the rights of consumers and investors, we are concerned that this investment trust is attempting to use the ethereum name deceptively to stimulate investment in a competing technology”
Regardless, Silbert told CoinDesk the open-ended trust won’t launch until ethereum classic’s monetary policy is finalized.
In particular, he noted uncertainty about a potential “hard cap” on the amount of ether classic that can be created in the future, a feature that he said could determine how work proceeds.
As part of that effort, a development team is being recruited for ethereum classic by blockchain developer Igor Artamonov, with further refinements to the ethereum classic improvement protocol being conducted by Snaproll, according to Avtar Sehra, who presented at the ETC monetary policy event in London last year.
Ethereum classic project coordinator Arvicco told CoinDesk that the monetary policy discussion is still “ongoing” with forthcoming events planned in China this month and next month, likely resulting in “some kind of consensus” by March.
Still, Arvicco downplayed the idea that the dispute is one that would result in any changes on what has been announced.
He told CoinDesk:
“Since [the] Grayscale announcement made it very clear beyond any doubt that it is ethereum classic that is the focus of their investment fund, I find the claims that it is somehow misleading quite ridiculous.”
Article Source: http://www.coindesk.com
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