The SEC’s enforcement division announced it is closing its investigation into Ethereum, but Consensys asserts the battle is not yet over. The United States Securities and Exchange Commission (SEC) has decided to cease its inquiry into whether Ether (ETH) is a security.
On June 19, Ethereum developer Consensys revealed in a social media post that “The Enforcement Division of the SEC has notified us that it is closing its investigation into Ethereum 2.0.”
This development indicates that the SEC will not pursue charges claiming that sales of ETH constitute securities transactions, which Consensys celebrated as a “major victory for Ethereum developers, technology providers, and industry participants.” The SEC’s decision followed a letter from Consensys on June 7 requesting the termination of the investigation into ETH.
In May, Consensys introduced spot Ether exchange-traded funds (ETFs), asserting that ETH is a commodity. Consensys senior counsel Laura Brookover shared the SEC’s response letter, stating that the agency does not “intend to recommend an enforcement action.”
The SEC has not yet provided a comment on this matter.
In March, Fortune reported that the SEC had issued subpoenas to several companies as part of efforts to classify ETH as a security.
In April, Consensys filed a lawsuit against the SEC after receiving a Wells notice, indicating potential violations of securities laws by its MetaMask crypto wallet. The lawsuit alleged that SEC Chair Gary Gensler and the SEC believed ETH to be a security since early 2023. Consensys claimed that SEC Division of Enforcement Director Gurbir Grewal had approved a formal order to investigate Ether’s status as a security on March 28, 2023.
Consensys confirmed that this lawsuit is still ongoing.
