SEC Eyes Ethereum as Potential Security Amid Foundation Probes
SEC considers classifying Ethereum as security; probes into Foundation intensify
The SEC is eyeing Ethereum (ETH) to possibly label it as a security, following a report by Fortune. At the same time, investigations are targeting the Ethereum Foundation for supposed illegal actions.
CoinDesk unveiled that the Foundation received a confidential inquiry from an unknown regulatory authority, as noted in a GitHub post last month. The inquiry's specifics remain under wraps, with the Foundation staying silent on the matter.
An online investigator, Boringsleuth, hinted at the Foundation's involvement in the 2016 Gatecoin hack on social media platform X.
The hack saw Gatecoin, a crypto exchange from Hong Kong, lose 185,000 Ethereum and 250 Bitcoin. According to Boringsleuth, blockchain analysis suggests the stolen funds ended up in a wallet tied to the Foundation, with him claiming to have proof of their involvement.
Boringsleuth later stated an independent law firm had started investigating the Foundation's alleged link to the hack. This adds to the Ethereum Foundation's scrutiny.
The SEC has expanded its investigation to Ethereum's network, spurred by its shift to a Proof-of-Stake blockchain via the Merge in 2022. The goal is to assess if Ether should be deemed a security token.
This includes probing companies associated with the Ethereum Foundation for documentation and financial interactions.
Following these developments, Ether's value has dipped over 2%, reflecting the market's reaction to the ongoing investigations.
This period marks intense regulatory attention on Ethereum and its governing Foundation, posing questions about future crypto regulations and governance.
