The U.S. Securities and Exchange Commission’s enforcement division has closed its investigation into Ethereum 2.0, which Consensys Software Inc. announced as a major victory.
On X, Consensys posted relief over the SEC’s decision, stating “This means that the SEC will not bring charges alleging that sales of ETH are securities transactions.”
The SEC’s decision follows Consensys’ letter dated June 7, seeking clarification after the approval of spot ether exchange-traded funds (ETFs) in May. These approvals, while pending finalization, signaled the SEC’s view that ETH tokens are commodities rather than securities, as per Consensys’ explanation.
Consensys said, “While we are gratified by the SEC’s decision to stand down on Ethereum, there is more work to be done to protect crypto in the United States.”
Consensys sued the SEC in April this year, alleging that the SEC’s Director of the Division of Enforcement, Gurbir Grewal, initiated the Ethereum 2.0 investigation in March 2023 to probe ether transactions.
Although SEC Chair Gary Gensler has not directly stated ether’s security status, Commodity Futures Trading Commission Chair Rostin Behnam has classified ether as a commodity.
Consensys has not wavered from its position and continues to argue that its lawsuit also seeks to declare that products such as MetaMask Swaps and Staking user interface software are not in violation of securities laws.
This is a positive development for Ethereum and the blockchain industry as a whole as it indicates a favorable regulatory environment for decentralized technologies.
