US SEC End Probe into Ethereum Status as Security
According to a June 19 tweet by Ethereum developer Consensys, the United States Securities and Exchange Commission (SEC) is dropping its investigation into Ether, the second-largest cryptocurrency by market capitalization, as a security.
The tweet reads, “The Enforcement Division of the SEC has notified us that it is closing its investigation into Ethereum 2.0. This means that the SEC will not bring charges alleging that sales of ETH are securities transactions.”
SEC Calls Ethereum a Security
In April, Consensys filed a lawsuit against the US SEC over its plans to regulate ETH as a security. The software company mentioned that the SEC’s threatened ETH regulation would cause damages to the token and its blockchain.
Following Consensys’ lawsuit, the US SEC, under the administration of its Chair, Gary Gensler, expressed conviction that the second largest cryptocurrency was classified as an unregistered security for a minimum of a year, leading to a series of investigations. The probe caused the price of the cryptocurrency to drop.
By referring to Ether as a security, the SEC likened the cryptocurrency to stocks, bonds, and notes. Such assets, therefore, require registration with the U.S. SEC before being traded to local investors.
Second-largest Cryptocurrency Secures a Major Win
Consensys’s tweet update on the SEC’s decision to conclude its investigation into Ethereum’s security status led to a 5% surge in ETH’s value. At press time, data on Coingecko showed Ethereum at $3500.
On-chain data also revealed that a whale ETH address made a big move following Consensys’ tweet. Since May 30, the address had withdrawn 16,604 $ETH($59M) from Binance and bought another 5,603 $ETH valued at $19.6M on June 19.
After @Consensys posted that the #SEC had closed its investigation into #Ethereum 2.0, the whale bought another 5,603 $ETH($19.6M).
The whale has withdrawn 16,604 $ETH($59M) at an average price of $3,600 from #Binance since May 30.https://t.co/NYbgSJevaT pic.twitter.com/N3vsISPeyX
— Lookonchain (@lookonchain) June 19, 2024
Notable Growth Following Spot ETF Approval
Since the SEC approved Nasdaq, CBOE, and NYSE applications for Ethereum spot ETFs, the network has shown notable growth records.
A peek into Donald Trump’s crypto wallet revealed that the former U.S. president does not hold any Bitcoin but about 464 ETH of Ethereum tokens.
In addition, a report from CryptoQuant showed that ETH demand increased after the launch of spot ETH ETFs in the USA.
Records showed that long-time investors bought an average of 5K ETH daily before the ETH ETF launch, which later increased to 40K ETH after the launch. The total holdings of whale ETH addresses also rose from 15.4M before the ETF launch to 16M after.