SEC to drop investigation into Ethereum: Consensys

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SEC to drop investigation into Ethereum: Consensys
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The United States Securities and Exchange Commission is dropping its investigation into whether Ether (ETH) is a security.

“The Enforcement Division of the SEC has notified us that it is closing its investigation into Ethereum 2.0,” Ethereum developer Consensys said in a June 19 X post.

“This means that the SEC will not bring charges alleging that sales of ETH are securities transactions,” which the firm hailed as a “major win for Ethereum developers, technology providers, and industry participants.”

Source: Consensys

Consensys said the SEC’s decision came after it sent a letter to the agency on June 7 asking if it would end its investigation into Ether as the regulator approved spot ETH exchange-traded funds (ETFs) in May, which the firm said was “premised on ETH being a commodity.”

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Consensys senior counsel Laura Brookover shared the SEC’s response letter to the firm, which states that the agency does not “intend to recommend an enforcement action.”

The SEC did not immediately respond to a request for comment.

In March, Fortune reported the SEC issued subpoenas to multiple companies which was related to attempts to label ETH as a security.

Related: SEC chair sees spot Ether ETF S-1 approvals sometime in summer 2024

Consensys sued the SEC in April suit shortly after receiving a Wells notice from the agency warning its MetaMask crypto wallet may have violated securities laws.

The lawsuit claimed the SEC and its chair Gary Gensler believed ETH was a security since at least early 2023. Consensys claimed SEC Division of Enforcement head Gurbir Grewal approved a formal order of investigation into Ether’s status as a security on March 28, 2023.

In its latest post, it said the lawsuit is still ongoing.

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