The United States Securities and Exchange Commission (SEC) is ceasing its investigation into whether Ether (ETH) is a security.
In a June 19 post on X, Ethereum developer ConsenSys announced, “The Enforcement Division of the SEC has informed us that it is closing its investigation into Ethereum 2.0.” The statement continued, “This means that the SEC will not bring charges alleging that sales of ETH are securities transactions,” which the firm celebrated as a “major win for Ethereum developers, technology providers, and industry participants.”
Consensys revealed that the SEC’s decision came after the firm sent a letter to the agency on June 7, inquiring about the status of its investigation into Ether. This inquiry followed the SEC’s approval of spot ETH exchange-traded funds (ETFs) in May, which Consensys argued was based on the premise that ETH is a commodity.
Laura Brookover, senior counsel at Consensys, shared the SEC’s response letter with the firm, stating that the agency does not “intend to recommend an enforcement action.”
The SEC did not respond immediately to a request for comment.
Earlier in March, Fortune reported that the SEC had issued subpoenas to multiple companies regarding efforts to classify ETH as a security.
Consensys filed a lawsuit against the SEC in April shortly after receiving a Wells notice from the agency, which warned that its MetaMask crypto wallet might have violated securities laws.
According to the lawsuit, Consensys alleged that SEC Chair Gary Gensler and the agency had considered ETH to be a security since early 2023. Consensys further claimed that Gurbir Grewal, head of the SEC’s Division of Enforcement, approved a formal order of investigation into Ether’s classification as a security on March 28, 2023.
In its recent update, Consensys stated that the lawsuit is ongoing and has not been resolved.
