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SEC Ends Ethereum Probe: Victory for Consensys and Blockchain Developers

SEC to drop investigation into Ethereum: Consensys celebrates major regulatory win.

Wed, 19 Jun 2024, 09:01 am UTC

The U.S. Securities and Exchange Commission has concluded its investigation into Ethereum, deciding not to classify ETH sales as securities transactions, according to a recent announcement by Consensys.

SEC Concludes Investigation into Ethereum, Declares ETH Sales Not Securities

In a recent report by CoinGape, despite Consensys' assertion that the battle is not yet over, the SEC's enforcement division has announced that it is concluding its investigation into Ethereum.

The Securities and Exchange Commission of the United States has discontinued its inquiry into Ether's classification as 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.”

Consensys stated that the SEC's decision resulted from a letter it sent to the agency on June 7, inquiring whether it would conclude its investigation into Ether. The firm argued that the regulator's approval of spot ETH exchange-traded funds (ETFs) in May was "premised on ETH being a commodity."

Senior counsel Laura Brookover shared the SEC's response letter to Consensys, which indicates that the agency does not "intend to recommend an enforcement action."

The Securities and Exc should have been a commission (SEC) that did not promptly address a comment request.

Consensys Lawsuit Against SEC Continues Amid Efforts to Classify ETH as a Security

Fortune reported in March that the SEC issued subpoenas to numerous companies in connection with its efforts to classify ETH as a security.

In April, Consensys filed a lawsuit against the Securities and Exchange Commission (SEC) shortly after receiving a Wells notice from the agency that suggested its MetaMask crypto wallet may have violated securities laws.

The lawsuit alleged that the SEC and its chair, Gary Gensler, had believed that ETH was a security since at least early 2023. On March 28, 2023, Consensys asserted that Gurbir Grewal, the director of the SEC Division of Enforcement, had authorized a formal order of investigation into Ether's status as a security.

The lawsuit is still ongoing, according to its most recent post.

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