The deal on Ethereum won’t stop the SEC, says a former regulator

A Conditional charge The lawsuit filed in Texas federal court aims to definitively determine Ethereum's regulatory status. But the move by blockchain software company Consensys in its home state may be far from the last legal showdown against the crypto secondary coin, as the Securities and Exchange Commission (SEC) has national reach.

“The SEC can bring the case anywhere in the country,” said Christopher Jerrold, a partner at Lowenstein Sandler LLP. Decrypt. “Today you can easily sue and sell unregistered securities in any jurisdiction you see fit: California, New York, [or Washington] DC”

in the complaintthe maker of Metamask said the Securities and Exchange Commission (SEC) has. Ethereum seen internally More than a year as security. (Disclosure: Consensys is one of 22 investors. Decrypt.) In other decisions related to MetaMask features, Consensys wants a judicial declaration that Ethereum is not a security.

Joe Lubin, the founder of Ethereum and CEO of Consensus, said Thursday that the companies' lawsuit “inGetting clarity from the US courtsHe said. But the legal controversy, even in Texas, may not be self-evident, according to Jerrold, who previously served as the head of the New Jersey Bureau of Safety.

“You have many judges [in Texas] They are concerned about the expansion of federal agencies and their role,” Jerrold said. “If you are against the rules […]That's when you bring your case.

Accord made the strategic choice to file the lawsuit in the U.S. District Court for the Northern District of Texas.Judge purchase” have become controversial. But that doesn't stop the SEC from choosing its own favorable legal ground if it decides to move forward with a separate lawsuit, Jerrold explained.

If the SEC wants to find Ethereum officially safe, they don't need to do it through a consensus lawsuit, he continued. And depending on how higher courts rule when those cases are appealed, Ethereum may be considered a security in one part of the US but not in another.

“Something may be legal in New Jersey and illegal in Texas,” Jerrold said, noting that federal district courts are not bound by decisions of other federal district courts.

If the Supreme Court decides not to ask the question of whether Ethereum is a security, that article of case law could be strengthened. Of course, Congress can pass new laws at any time that dictate how digital assets are handled, Jerrold said.

The SEC has not filed any charges related to the Ethereum-specific investigation that Consensys claims is underway. And Jerrold expects the agency will seek to dismiss the case first without telegraphing its internal thoughts on Ethereum's legal status.

A lawsuit from the SEC could follow, building on Wells' announcement to Consensys, as usual, Jerrold said. Wells' notice from the SEC typically precedes formal payments. It could be years before the regulatory issue over Ethereum is fully resolved, coming up in several different courts along the way.

“There are different ways. [that this] “He can go,” Jerrold said. But the idea that this consensus case begs the question [of] Whether Ethereum is secure or not – and right now it's the only platform with this capability – is a lie.”

Edited by Ryan Ozawa.