Traditionally, the same thing that made cryptocurrencies into pariahs also made them unique. Bitcoin, Ethereum and other first-generation tokens relied on Proof of Work to run their blockchains, a labor-intensive mathematical process that consumes obscene amounts of electrical power.
While their high power use didn’t exactly endear crypto tokens to environmentalists, they did distinguish the tokens from traditional securities. There’s a hard cost to create a Bitcoin or an original Ether token, much as there’s a hard cost to mine gold — another asset that society has arbitrarily decided is valuable.
Because holders of Bitcoin expect their tokens to gain value mostly due to the high cost of creating them — and because Bitcoins aren’t used for anything other than making financial transactions — mined coins like Bitcoin have thus far escaped many traditional regulations.