Gary Gensler, Chairman of the US Securities and Exchange Commission (SEC), Reiterated that Proof-Of-Stake Tokens Are Securities.
Gary Gensler, Chairman of the US Securities and Exchange Commission (SEC), made statements about cryptocurrencies at his press conference. Gensler noted that tokens using staking protocols are securities under US law. Therefore, he stressed that his agency falls under his jurisdiction. Gensler explained that securities laws could be triggered in this situation as investors expect profits when purchasing tokens under the Proof-of-Stake (PoS) mechanism. He emphasized that the introduction of a protocol and the locking of tokens within the protocol must comply with regulations, similar to intermediaries.
“The investing public invests with the expectation of a return. They want to generate returns from these proof-of-stake (PoS) tokens.”
In short, Gensler considers tokens using staking protocols to be securities under US law. Since the transition of Ethereum to The Merge, Gensler believes that all Ethereum transactions fall under US jurisdiction. It also sees ETH staking as a security investment contract. However, he does not think the same for Bitcoin.
Gary Gensler's comments came just a week after the CFTC emphasized that Ethereum should fall into the commodity category. The agency states that because Ether futures are traded on the CFTC exchange, they should fall under their jurisdiction. Earlier, Rostin Behnam, head of the Commodity Futures Trading Commission (CFTC), said that he views most stablecoins as commodities. But the CFTC chairman has a different view, not considering Ethereum as a security.
