SEC Considers Ethereum a Security for at Least a Year: Report

The SEC launched investigations into Ethereum as a security in March 2023.
The regulator sent a subpoena and a notice of Wells to Consensys, an Ethereum development firm.

The US Securities and Exchange Commission (SEC) has reportedly been treating Ethereum as an unregistered security for at least a year, FOX Business reports. on Monday.

According to the publication, this speculation about ETH comes in the wake of court applications by Ethereum software development company Consensys.

The company, which sued the SEC last week over investigations surrounding the cryptocurrency, asserts that Ethereum is not a security.

The deals sued the SEC.

The lawsuit filed by Texas-based Consensus Group, led by Gary Gensler, accuses the SEC of “excessive” regulation of the crypto space. The suit also asked the court to declare that ETH is not a security.

The SEC's announcement of Wells to communicate and the investigation into the Ethereum Foundation have been key events in the past few weeks.

According to FOX Business, documents show that the SEC's enforcement department has considered Ethereum as an unregistered security since March of last year. According to the documents, the investigation centers on the so-called “Ethereum 2.0”.

The SEC believes that there will be “offers and sales” of securities involving Ethereum starting in 2018.

Ironically, this is the same year that the SEC's current director of corporate finance, Bill Hinman, said that Ethereum is a security. Former SEC Chairman Jay Clayton provided guidance for that, while the Commodity Futures Trading Commission considered ETH a commodity.

But in new court documents, SEC Enforcement Division Chief Gurbir Grewal has given his nod for a formal investigation into Ethereum's status on March 28, 2023.

The order allowed law enforcement officials to investigate and issue court orders to entities and individuals believed to be involved in the buying and selling of ETH.

These investigations have created part of the hurdle market experts say the SEC may ban Ethereum ETFs in May.