A big revelation came yesterday i.e. on April 29 after Ethereum software firm Consensys filed a complaint against SEC in the Federal Court of Texas on April 25. The SEC's stance on ETH has been revealed in this disclosure. Court documents filed by Consensys on April 29 revealed that the SEC and its Chairman Gary Gensler believed that Ethereum was a security at least for some time.
The report reveals that Gary Gensler has been maintaining for the past year that ETH is an unregistered security trading out of compliance with current federal regulations. This latest filing comes in response to the Wells Notice from the regulators, which details the plan to sue Consensys for failing to comply with federal securities laws.
According to the new filing, on March 28, 2023, Gurbir Grewal, head of the SEC's Division of Enforcement, approved a formal order to investigate Ether's status as a security.
Investigating the status of ETH, known as the Ethereum 2.0 investigation. The investigation into Ether's status as a security in 2023 by the head of the SEC's Division of Enforcement is known as the Ethereum 2.0 investigation. The investigation has reportedly authorized the enforcement staff to investigate and summon individuals and entities involved in the buying and selling of cryptocurrencies.
Notably, the investigation on Ethereum 2.0 was reportedly based on the SEC's belief that possible unregistered offerings and sales of ETH occurred since 2018. However, SEC’s chief Gary Gensler did not clarify for the past year whether Ether is a security or not.
After the SEC approved 11 spot Bitcoin ETFs in January, ETFs for other cryptocurrencies were expected to be approved soon. These currencies also included big currencies like Ethereum and XRP. Where it was expected that the SEC might soon approve to spot Ethereum ETF. Crypto market experts are expecting, that the SEC might approve a spot Ethereum ETF in May.
However, due to the SEC considering Ethereum a security and ongoing investigations into exchanges, spot Ethereum ETF approval is in limbo. Crypto investors are constantly accusing the SEC that SEC chief Gensler is deliberately delaying its approval. At present, all eyes are on the court's decision. It is noteworthy that in a similar case, in the lawsuit between SEC and Ripple. Ripple got a partial victory, in which the court had said that XRP is not a security.
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