Key Takeaways:
- The SEC has closed its investigation into Ethereum 2.0, a major victory for Consensys
- This decision indicates a shift towards recognizing ETH as a commodity rather than a security, influenced by recent approvals of spot Ether ETFs.
In a significant development for the cryptocurrency industry, leading Ethereum developer Consensys announced that the U.S. Securities and Exchange Commission (SEC) has closed its investigation into Ethereum 2.0. This decision marks a pivotal moment for Ethereum developers, technology providers, and industry participants.
Consensys shared the news late Tuesday via a Twitter post, celebrating the SEC’s decision. “Today we’re happy to announce a major win for Ethereum developers, technology providers, and industry participants: the Enforcement Division of the SEC has notified us that it is closing its investigation into Ethereum 2.0,” the post read.
The announcement further clarified that the SEC would not pursue charges alleging that sales of ETH are securities transactions.
The investigation, which began to circulate in March 2024, had targeted three unnamed entities supporting the Ethereum protocol for potential securities violations.
The probe prompted Consensys to sue the SEC in April 2024, accusing the agency of regulatory overreach and attempting to classify ETH as a security following its transition to proof of stake in September 2022.
Laura Brookover, a lawyer for Consensys, emphasized that the SEC did not drop the investigation voluntarily. She suggested that the decision was influenced by recent approvals of spot Ether exchange-traded funds (ETFs), which were based on ETH being classified as a commodity.
Brookover stated, “There will be no more protestations from the SEC that Ether is a security.”
The SEC’s approval of these ETFs hinted at a shift in its stance, acknowledging ETH as a commodity rather than a security.
However, the SEC has not publicly confirmed this change in classification. The correspondence from the SEC included standard language noting that the termination of the investigation should not be interpreted as an exoneration or a guarantee that no further action would result from the staff’s inquiry.
