SEC Drops Probe, Delivering Significant Win for Ethereum

June 19, 2024 at 12:50 PM GST 2 mins read News

Ether rallies amid rumors of an SEC probe into Ethereum.
Consensys announced that the SEC is closing its investigation into Ethereum 2.0.
Further approvals needed for products from giants like BlackRock and Fidelity Investments.

Ether token surged this week, fueled by speculation that the U.S. Securities and Exchange Commission (SEC) might be easing its regulatory scrutiny of the Ethereum blockchain. As the second-largest digital asset, Ether climbed as much as 3.6% on Wednesday, reaching $3,562 before settling at that level.

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The SEC’s investigation into the Ethereum Foundation raised questions about whether Ether could face regulatory challenges. A potential classification as a security could dampen demand for this digital asset.

ETHEREUM SURVIVES THE SEC.

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.

This means that the SEC…
— Consensys (@Consensys) June 19, 2024

Consensys Clears the Air

Consensys, a prominent Ethereum developer, announced that the SEC is closing its investigation into Ethereum 2.0. This decision follows Consensys’ letter to the SEC on June 7, seeking confirmation that the recent approvals for Ethereum-based exchange-traded funds (ETFs) signaled the end of the Ethereum 2.0 probe.

The SEC’s Enforcement Division confirmed this closure, providing relief to the Ethereum community. While Bitcoin is widely regarded as a commodity, the SEC’s stance on other tokens remains contentious. SEC Chair Gary Gensler’s position on Ether’s classification has been ambiguous. Crypto enthusiasts fear that Ether and Ethereum-based projects could fall under the agency’s stringent rules, impacting innovation and growth.

What Lies Ahead

Consensys’ legal battle with the SEC underscores the importance of regulatory clarity. The agency’s approval of spot ETH ETFs is a positive sign, but further approvals are needed for products from giants like BlackRock and Fidelity Investments.

The SEC’s decision to close the Ethereum 2.0 investigation is a step forward. As the digital asset market matures, the fate of Ether hangs in the balance, with implications for the broader blockchain ecosystem.