Key Points
- Joseph Lubin, founder of ConsenSys, believes that the regulatory crackdown on cryptocurrency firms by the SEC may be coming to an end.
- Despite the SEC ending its investigation into Ethereum, ConsenSys will continue with its lawsuit against the commission.
Joseph Lubin, the founder of ConsenSys, has recently expressed optimism that the United States Securities and Exchange Commission’s (SEC) regulatory crackdown on cryptocurrency firms may soon be concluding.
Lubin’s confidence stems from a significant milestone achieved by the cryptocurrency industry with the SEC. In a surprising decision, the commission has concluded its investigation into Ethereum, which started in March 2023 under the direction of Gurbir Grewal, Director of the SEC’s Division of Enforcement.
ConsenSys Continues Lawsuit Against SEC
FOX Business journalist Eleanor Terrett reported on Lubin’s reaction to the SEC’s decision on the Ethereum investigation. While Lubin views this as a major victory for the industry and a necessary step, he does not consider it sufficient.
“There has to be a better way to regulate the market than through ambush,” Lubin stated. He remains hopeful that the hostility towards cryptocurrency among some U.S. regulators is starting to diminish and that the national investor protection strategy will evolve.
Despite the recent positive development, ConsenSys will continue with its lawsuit against the SEC, which was filed in April of this year. This lawsuit concerns the SEC’s classification of Ethereum, the second-largest cryptocurrency by market capitalization, as a security. Like ConsenSys, many other cryptocurrency firms disagree with the SEC’s classification of related altcoins.
In the lawsuit, ConsenSys requested that the securities regulator provide better legal clarity regarding the regulation of cryptocurrencies. Even with the recent conclusion of the investigation into Ethereum, Lubin maintains that clear regulatory guidelines are still needed.
Implications of SEC’s Decision on Ethereum Investigation
With the closure of the investigation, many cryptocurrency projects are poised to be free from the SEC’s legal restrictions. This means that Gary Gensler and his team will no longer pursue charges that Ethereum’s sales constituted securities transactions.
The SEC’s recent approval of spot Ethereum ETFs subtly hinted at this latest development. The regulator’s previous inclination to classify Ethereum as a security had raised concerns about its potential negative impact on Ethereum ETF applications. However, the SEC unexpectedly approved the proposed rule change.
Trading for the Ethereum ETFs is yet to commence, but the filers are working on their S-1 registration as requested by the SEC. The SEC’s new stance towards cryptocurrency may influence how quickly trading starts for spot Ethereum ETFs. Furthermore, the price of Ethereum is also likely to increase in the coming weeks. At the time of writing, Ethereum was trading at $3,584.63, with a 1.61% increase within the last 24 hours.
