SEC has considered Ethereum a security for extended period

As a long-term crypto investor with experience in following the regulatory landscape, I find the ongoing legal battle between Consensys and the U.S. Securities and Exchange Commission (SEC) over Ethereum’s regulatory status concerning. The SEC’s stance that Ethereum is a security since at least 2018 contradicts previous guidance under Jay Clayton’s tenure, causing confusion for investors like myself.

For over a year, the Securities and Exchange Commission (SEC) of the United States, headed by Chairman Gary Gensler, has held the view that Ethereum qualifies as a security.

Based on FOX Business’ report, Consensys, the Ethereum software developer, filed an unveiled complaint against the agency following this disclosure.

According to the document, the Ethereum 2.0 investigation was initiated based on the SEC’s suspicion that certain securities, such as ETH, may have been sold or offered for sale starting from 2018.

As a crypto investor following the Consensys case closely, I’ve noticed that the Securities and Exchange Commission (SEC) has been pressing for detailed information about Consensys’ involvement in Ethereum’s proof-of-stake update, as well as their acquisitions, holdings, and sales of Ethereum over the past year. The documents released suggest that the SEC may consider Ethereum tokens sold prior to the 2018 merger as securities.

The SEC’s more recent stance, which classifies Ethereum as a security, conflicts with the previous viewpoint held during Jay Clayton’s tenure. Contradicting this, Bill Hinman, then the SEC’s CFO, declared in a June 2018 speech that both Ethereum and Bitcoin were not considered securities by the commission.

Before Gensler’s testimony, the chairman’s hesitance to clearly state Ethereum’s regulatory classification caused concern within the crypto industry. Some believe that the Ethereum Merge has shifted the cryptocurrency closer to being a security compared to its initial consensus mechanism.

Consensys took the step of filing a lawsuit against the SEC to prevent the regulatory body from gaining oversight authority over the Ethereum blockchain.

According to ConsenSys, our response was prompted by the Wells notice received on April 10th, signaling the SEC’s intent to instigate enforcement actions against us, primarily concerning MetaMask wallet services. It is essential to clarify that MetaMask functions neither as a broker nor does it maintain users’ digital assets or execute transactions.

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2024-04-29 18:36