SEC closes investigation into Ethereum 2.0, no securities charges against ETH: Consensys
SEC's decision marks a turning point for Ethereum, likely confirming its commodity status.
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The US Securities and Exchange Commission (SEC) has wrapped up its investigation into Ethereum 2.0 and will no longer pursue legal action claiming that ETH sales are securities transactions, according to a recent announcement from Consensys.
Consensys said this is a major win for Ethereum developers and businesses. It removes a cloud of uncertainty that could have hampered Ethereum’s growth.
In March, an update on the Ethereum Foundation’s GitHub repository revealed that the organization was under investigation by an unnamed “state authority.” After the discovery, Fortune reported that the SEC pursued an “energetic legal campaign” to classify Ethereum as a security.
Uncertainty intensified after Consensys filed a lawsuit against the SEC in April. Part of the company’s effort was seeking a court ruling that would declare that Ethereum’s native token, Ether (ETH), is not a security.
FOX Business reported in late April that the SEC’s Enforcement Division, headed by Gurbir Grewal, initiated a formal investigation into Ethereum’s status as a security in March 2023. The investigation, known as “Ethereum 2.0“, explores transactions and activities associated with Ethereum dating back to 2018.
As noted, the SEC’s latest decision comes after Consensys sent a letter to the SEC arguing that the recent approval of spot Ethereum ETFs implies ETH is not a security, and the SEC should close the investigation. The move likely hinged on considering ETH a commodity, much like BTC, and signifies no forthcoming legal challenges.
Despite this progress, Consensys said the quest for definitive regulatory guidelines continues, especially concerning services like MetaMask Swaps and Staking. The team is still seeking broader clarity from the SEC on crypto regulations.
Our fight continues. In our lawsuit, we also seek a declaration that offering the user interface software MetaMask Swaps and Staking does not violate the securities laws. It should not take a lawsuit to provide the much-needed regulatory clarity to allow an industry that serves…
— Consensys (@Consensys) June 19, 2024
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