According to Cointelegraph: SEC Suspected Ether To Be A Security For Over A Year
In an unfolding tide of events, reports suggest that Gary Gensler, chairman of the United States Securities and Exchange Commission (SEC), and the SEC have thought of Ether as a security for at least a year.
Fox Business producer Eleanor Terret's reports cite court documents filed on April 29 by Ethereum software firm Consensys. According to the documents, Gensler and the SEC might have held the thought of Ether as an "unregistered security trading out of compliance with federal regulations" for at least a year.
Recently, Consensys lodged a compliant against the SEC in a Texas federal court on April 25, following an unredacted complaint against the SEC. The compliant reacted to a Wells notice from the SEC detailing its plans to take legal action against Consensys on grounds of failure to comply with federal securities laws.
The newly released court documents disclose that on March 28, 2023, Gurbir Grewal, the head of the SEC's Division of Enforcement, had sanctioned a formal investigation order into Ether's status as a security.
The "Ethereum 2.0" probe approved the enforcement staff to investigate and subpoena entities and individuals involved in trading the cryptocurrency. Recipients of the subpoenas were strictly instructed by the SEC to maintain confidentiality about the investigation.
The new revelation is likely to cause a ripple in the current state of affairs, given Ether and Bitcoin were deemed non-securities under previous SEC Chair, Jay Clayton, back in June 2018 as stated by then-Director of Corporation Finance, Bill Hinman.
Furthermore, Gensler's stance could potentially affect the decision process for a spot Ether exchange-traded fund in the U.S., as he declined to clarify Ether's security status last year.
