ConsenSys, the blockchain software development company behind Infura and MetaMask, has notified that the US securities regulator SEC is closing its investigation into Ethereum 2.0.
The Securities and Exchange Commission (SEC) investigation into Ethereum began after the implementation of The Merge, the update that transformed the blockchain into a Proof of Stake (PoS) blockchain.
The SEC was looking to classify Ethereum as a security, so it launched a vigorous legal campaign against the cryptocurrency and blockchain network. According to the US securities regulator, Ethereum's change of consensus protocol from PoW to PoS after the implementation of The Merge could have turned the blockchain's native cryptocurrency into a security.
However, on June 18, ConsenSys reported that it had received a notice from the SEC, stating that was closing his research on cryptocurrencyThis notification represents a major milestone for both Ethereum and the crypto community, as the SEC will no longer be able to pursue charges against projects and developers alleging that the sale of ether (ETH) represents unregistered securities transactions.
ConsenSys had filed a lawsuit against the federal regulator in April this year, alleging inconsistencies in ether classification and excessive abuse of authority by the regulator after Wells sent a notice to MetaMask.
The blockchain infrastructure company also sent a letter to the federal securities agency on June 7, asking for clarity on Ethereum's classification following the regulatory approval it granted to the cryptocurrency's spot ETFs last April.
Great news for Ethereum and the crypto community
The SEC's position on Ethereum is very important for the development of cryptocurrency and the crypto industry, so the recent notification made by the federal regulator represents a significant victory that ensures that it will not take legal action against developers of projects and applications that operate within the Ethereum ecosystem.
As highlighted by ConsenSys, the new victory ensures that Ethereum continues to be “a vibrant and indispensable blockchain platform” preserving access for the countless developers, market participants and institutions interested in exploring this colossal digital ecosystem.
Currently, Ethereum is the second largest blockchain and cryptocurrency on the market, with a market capitalization of over $ 430.000 million dollars.
This notification comes almost two months after the SEC gave the green light to Ethereum spot ETFs in the US market. As reported by this outlet, the securities regulator approved the 19B-4 filings of Ethereum spot ETFs on April 23 and the approval of the funds’ S-1 filings, which will officially authorize the ETFs to be listed on exchanges, is expected to take place in early July.
What will happen to Ripple?
Now that the SEC has ended its legal battle against Ethereum to label ETH as a security, the crypto community is hoping that Ripple’s (XRP) situation with the federal regulator can also be clarified.
Ripple has been embroiled in a long-running dispute with the SEC since December 2020 over the company’s alleged sale of unregulated securities in conjunction with its XRP offering.
The SEC’s enforcement actions against several crypto industry projects have been called aggressive and outside the agency’s jurisdiction. Furthermore, blockchain project developers have accused the SEC of undermining innovation and hindering technological development in the country. Thus, despite the recent victory, ConsenSys claims that it will continue its battle with the regulator in search of greater regulatory clarity for crypto industry projects.
“The closure of the Ethereum investigation is momentous, but it is not a panacea for the many blockchain developers, technology providers, and industry participants who have suffered under the SEC’s illegal and aggressive cryptocurrency enforcement regime.”, expressed the company.
ETH price rises by 3%
On the other hand, at the time of writing this article, the price of Ethereum reflects a 3% increase in the market, trading at around $3.520 per unit. The cryptocurrency is benefiting from the notification of the closure of the investigation by the SEC.
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