NY AG Urged SEC to Declare Ethereum a Security, Coinbase Docs Reveal

Newly released documents from Coinbase show that the New York Attorney General's Office requested the U.S. Securities and Exchange Commission (SEC) to officially declare Ethereum’s native token, ether (ETH), a security during its 2023 lawsuit against crypto exchange KuCoin. The request was made by Shamiso Maswoswe, head of the AG's Investor Protection Bureau, who asked the SEC to file an amicus brief supporting the classification of ETH as a security, stating that it would benefit investor protection—even though New York has authority over both securities and commodities.

These documents were obtained through a Freedom of Information Act (FOIA) request and are part of Coinbase’s broader legal battle against federal crypto regulations. Coinbase has been steadily releasing internal agency communications, which previously included letters from the FDIC suggesting banking regulators discouraged crypto engagement.

Despite the AG’s request, the SEC refrained from officially labeling ETH a security. The agency had earlier implied ETH was a commodity but appeared uncertain after Ethereum’s transition to proof-of-stake. In the end, the SEC continued to treat ETH similarly to bitcoin (BTC), implying it remains a commodity.

The dispute highlights ongoing regulatory confusion in the U.S., where the SEC and Commodity Futures Trading Commission (CFTC) share oversight but differ in asset classification. In contrast, New York’s Department of Financial Services oversees both categories. Ultimately, the state secured a $22 million settlement from KuCoin for operating without proper registration.

Additional SEC emails also referenced concerns about Ripple and XRP’s decentralization in 2021. The SEC’s lawsuit against Ripple recently concluded with a favorable outcome for the blockchain company, including a refund of penalties previously levied.

These revelations underscore the crypto industry’s persistent struggle for regulatory clarity in the U.S.