The United States Securities and Exchange Commission (SEC) has intensified its legal battle with the crypto industry by filing a complaint against ConsenSys, a company blockchain company known for its MetaMask wallet product and its focus on the Ethereum network.
The SEC alleges that ConsenSys violated federal securities laws by operating as an unregistered broker-dealer while offering services for “crypto securities,” racking up fees exceeding $250 million.
SEC Lawsuit Against ConsenSys
THE SEC Lawsuit against ConsenSys echoes similar complaints against other crypto companies such as Coinbase and Kraken. However, what sets this lawsuit apart is the context in which ConsenSys responded to the SEC’s actions.
In April, ConsenSys filed a complaint against the SEC after receiving a notice from Wells seeking clarification on whether Ethereum should be classified as a security. Most recently, ConsenSys announced the closure of the SEC’s “Ethereum 2.0” investigation, interpreting it as an indication that Ethereum was outside the agency’s jurisdiction.
Notably, the SEC did not name Ethereum as one of the unregistered securities offered by ConsenSys in Friday’s filing, which may have led to the approval Ethereum ETF applications from the world’s largest asset managers on May 23.
The Crypto Industry’s Regulatory Battle
ConsenSys, founded by Joseph Lubinone of Ethereum’s developers, stands out from previous SEC targets. Rather than operating as an exchange, ConsenSys focuses on developing software, including the MetaMask digital wallet.
The SEC lawsuit claims the company violated securities laws by allowing the “exchange” of crypto assets through MetaMask. The agency specifically targeted Ethereum staking servicesnamely Lido and Rocket Pool, alleging that their tokens, stETH and rETH, respectively, are unregistered securities.
The SEC further claims that ConsenSys facilitated more than 36 million crypto asset transactions, including at least 5 million involving what the agency considers securities.
Previously, the SEC had brought similar costs staking-related lawsuit against Kraken, resulting in a $30 million settlement, while Coinbase disputed the charges.
Although the SEC’s new complaint against the blockchain company does not classify Ethereum as a security, it represents another front in the SEC’s ongoing campaign against major players in the crypto industry.
Many in the crypto community may consider this a partial victory, given the lack of inclusion of Ethereum as a unregistered security. However, the lawsuit further highlights the regulatory uncertainties surrounding the industry’s largest companies.
ConsenSys, currently engaged in an ongoing lawsuit against the SEC in Texas, has criticized the agency’s actions, accusing it of pursuing an “anti-crypto agenda” through arbitrary enforcement actions and overreach. regulation.
At the time of writing, ETH was trading at $3,777, down 2.3% in the past 24 hours, as the cryptocurrency market continues to experience significant selling pressure.
Featured image of DALL-E, chart by TradingView.com
