Ethereum Secures Victory as SEC Confirms ETH is Not a Security
In a groundbreaking decision, the SEC has officially concluded its investigation into Ethereum, affirming that ETH sales do not qualify as securities transactions. This resolution comes after ConsenSys, a prominent Ethereum developer, reached out to the SEC to reaffirm Ether’s status as a commodity following the approval of Ethereum ETFs in May.
ConsenSys hailed the news as a significant victory for Ethereum developers, technology providers, and industry participants. However, they also highlighted the ongoing regulatory battle with the SEC under the leadership of Gary Gensler.
On June 7, ConsenSys sent a letter to the SEC seeking confirmation that the approval of ETH ETFs would result in the closure of the Ethereum 2.0 investigation. The SEC’s notification letter, shared by ConsenSys attorney Laura Brookover, confirmed the end of the investigation without any charges against parties involved.
ConsenSys reiterated that Ethereum is a global computing platform and not an investment scheme, emphasizing that Ether (ETH) is classified as a commodity, a stance supported by the CFTC. They clarified that applications utilizing Ethereum for transactions are not considered securities brokers and are therefore not subject to SEC regulation.
Criticism was directed towards the SEC’s approach, with ConsenSys calling it an unlawful power grab that could potentially hinder America’s leadership in the internet’s next generation. Concerns were raised about the SEC’s inconsistent treatment of cryptocurrencies, citing the contrast between the closure of the Ethereum investigation and the agency’s aggressive stance against Ripple (XRP).
Following the announcement, Lookonchain reported a significant whale investor purchasing an additional 5,603 ETH valued at $19.6 million. Since May 30, the investor has withdrawn a total of 16,604 ETH worth $59 million from Binance at an average price of $3,600 each.
While the market celebrates this development, the SEC’s statement included standard language indicating that the closure of the investigation does not absolve the parties involved of all potential wrongdoing. Nevertheless, this decision is seen as a triumph for Ethereum and the wider crypto community seeking regulatory clarity.