LATEST: SEC Ends Ethereum 2.0 Investigation, Declares No Legal Action on ETH Sales

The U.S. Securities and Exchange Commission (SEC) has concluded its investigation into Ethereum 2.0, deciding not to pursue legal action alleging that ETH sales are securities transactions, as announced by Consensys Software Inc. This decision is seen as a significant victory for Ethereum developers and industry participants, alleviating a major uncertainty that could have impeded Ethereum’s growth.

The investigation, initiated by the SEC’s Enforcement Division under Gurbir Grewal in March 2023, examined Ethereum transactions dating back to 2018. The probe gained attention in March when an update on the Ethereum Foundation’s GitHub revealed scrutiny from an unnamed “state authority,” later identified as the SEC. Consensys had filed a lawsuit against the SEC in April, seeking a ruling that Ether (ETH) is not a security. The SEC’s decision to close the investigation followed a letter from Consensys, which argued that the approval of spot Ethereum ETFs implied ETH is a commodity, not a security.

While this development is a positive step, Consensys continues to seek broader regulatory clarity, particularly regarding services like MetaMask Swaps and Staking. The quest for definitive guidelines from the SEC remains crucial for the ongoing development and regulation of the cryptocurrency industry.

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