US SEC Ends Inquiry into Ether’s Security Status
The Securities and Exchange Commission (SEC) has concluded its investigation into whether Ethereum’s digital currency, Ether, qualifies as a security. Consensys, an Ethereum developer, announced that the SEC’s Enforcement Division informed them of the decision to close the investigation on June 19.
Consensys stated, “This means that the SEC will not pursue charges alleging that sales of ETH are securities transactions.” The developer celebrated the SEC’s decision as a significant victory for Ethereum’s development, technology, and the industry as a whole.
After the SEC approved Ethereum spot ETFs last month, Consensys sent a letter to the SEC seeking clarification on the implications of this decision on the ongoing investigation into Ether. The company argued that these funds were based on Ether being classified as a commodity.
In a post on X, Consensys attorney Laura Brookover shared the SEC’s official response and a detailed statement from the company regarding the SEC’s decision. Brookover noted that since they filed their lawsuit against the SEC in late April, circumstances had changed rapidly, culminating in the conclusion of the Ethereum investigation without any charges being filed.
The SEC’s letter did not provide a definitive classification for Ethereum but avoided categorizing it while using legal language to indicate that the end of the investigation does not necessarily align with Consensys’ assertions.
In April, Consensys sued the SEC, accusing the regulator of “overzealous regulation” and claiming that it planned to label Ethereum as a security. The lawsuit also alleged that the SEC had internally made this decision a year earlier. Consensys challenged the SEC’s authority, arguing that the agency can only regulate securities and had previously stated that Ether was not one. This lawsuit followed a warning from the SEC regarding Consensys’ MetaMask wallet potentially violating securities laws.
In its statement on June 19, Consensys made it clear that it remains steadfast in its opposition to the SEC’s actions concerning MetaMask and intends to continue fighting the agency on this matter. The company expressed the need for regulatory clarity to allow the industry to thrive and declared, “It should not take a lawsuit to provide the much-needed regulatory clarity to allow an industry that serves as the backbone to countless new technologies and innovations to thrive – but here we are.”
Following the news, the price of Ether experienced a rally, with a 3.5% increase in the last 24 hours, trading above $3,500.
