SEC rules Ethereum is not a security, Consensys confirms
The United States Securities and Exchange Commission (SEC) has closed its investigation into whether Ethereum (ETH), should be classified as a security.
Ethereum developer Consensys announced in June 19 through an X post that the SEC’s Enforcement Division had notified them about the conclusion of the investigation into Ethereum 2.0. The post reads:
Today we’re happy to announce a major win for Ethereum developers, technology providers, and industry participants: the Enforcement Division of the SEC has notified us that it is closing its investigation into Ethereum 2.0.
This means that the SEC will not bring charges alleging that sales of ETH are securities transactions.
A sigh of relief
Consensys had previously sent a letter to the SEC on June 7, requesting clarification on the status of the investigation, citing the agency’s approval of spot Ethereum exchange-traded funds (ETFs) in May. Such an approval purportedly implied that ETH was considered a commodity.
Laura Brookover, senior counsel at Consensys, shared the SEC’s response letter, confirming that the agency did not intend to recommend an enforcement action. The SEC has not yet provided an official comment on the matter.
Link to the SEC’s letter: https://t.co/1CGbnrtQy0
— Laura Brookover (@laurabrooksie1) June 19, 2024
In March, reports emerged that the SEC had issued subpoenas to several companies in an attempt to label ETH as a security. Still, Consensys’ lawsuit against the SEC over its notice suggesting that the MetaMask crypto wallet may have violated securities laws is still ongoing.
The lawsuit claimed that the SEC and its chairman, Gary Gensler, had believed ETH to be a security since early 2023, with the SEC’s Division of Enforcement Director, Gurbir Grewal, approving a formal order of investigation on March 28, 2023.
The resolution of the SEC’s investigation into Ethereum’s security status is expected to provide clarity and relief for the Ethereum community and the broader cryptocurrency industry.
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