Good news is coming

After the SEC (U.S. Securities and Exchange Commission) announced in 2018 that Ether (ETH) was not classified as a security, the agency surprisingly decided to privately reclassify the digital asset as a security in 2023 and continued an ineffective investigation of Ethereum. In order to defend the integrity and interests of the Ethereum ecosystem, ConsenSys filed a lawsuit against the SEC on April 25, 2024, asking the court to order a halt to its investigation. Our position is that ETH should be considered a commodity and the SEC has no authority to investigate or regulate it.

Since we filed the lawsuit, numerous policymakers (including members of Congress) and the public have expressed deep concerns about the SEC's Ethereum 2.0 investigation. Therefore, on June 7, we wrote to the SEC asking whether its approval of the ETH ETF in May (based on the premise that ETH is a commodity) means that the agency will end its investigation into Ethereum 2.0.

Today, we received a response from the SEC's Enforcement Division, who notified us that they would end their investigation into Ethereum 2.0 and promised not to take any enforcement action against ConsenSys.

While we welcome the SEC’s decision, we know there is still much work to do to protect cryptocurrencies in the United States. We call on the SEC to abandon its murky, opaque regulatory approach and instead provide a clear, transparent regulatory framework for an industry that is an important pillar of so many new technologies and innovations. In addition, our lawsuit asks the federal court to rule that ConsenSys is neither a broker nor has issued securities through our software products MetaMask Swaps and Staking.

We firmly believe that no company or individual should be forced to go through costly legal proceedings to clarify the legality of their business activities. As we emphasize in our lawsuit, “At its core, ConsenSys develops software products that enable users around the world to use and build on the Ethereum network. We have the right to conduct our business without facing the costs, burdens, and uncertainty that come with unlawful law enforcement actions.” The entire crypto industry deserves the same right. We hope that today’s progress will open a new chapter and bring more clarity and fair regulation to the entire industry.