According to a report by Fortune magazine, the U.S. Securities and Exchange Commission (SEC) is conducting an investigation into American cryptocurrency companies. Based on statements from U.S. companies that have received subpoenas related to the investigation, the SEC is actively pursuing legal action aimed at classifying Ether as a security. This news further dampens the industry’s hopes for the regulatory agency to approve applications for Ethereum spot ETFs from companies like BlackRock.
The report indicates that the SEC began investigating the Ethereum Foundation around September 2022, shortly after the Ethereum network transitioned to the Proof of Stake (PoS) consensus mechanism. Furthermore, sources have pointed out that the Ethereum Foundation received subpoenas in the past few weeks, which may explain the recent removal of the Canary image by the foundation (although the claim of receiving subpoenas seems to contradict the foundation’s claim of “voluntariness”).
Although the release of this news caused a drop in the price of ETH, many industry professionals believe that while it is not good news, it is not necessarily a terrible negative development either. Moreover, the SEC classifying Ether as a security does not appear to be a groundbreaking revelation. The market seems to have also recognized this, as the price of ETH has stabilized and started to rebound.
