Key Points
- The U.S. SEC has reportedly issued subpoenas to several companies, trying to label ETH as a security.
- SEC’s campaign is related to the blockchain’s transition from PoW to PoS in 2022.
- SEC’s quest to classify ETH as a security could have significant implications for Ethereum, an ETH ETF, and the whole crypto industry.
A March 20 report addresses an investigation conducted by the SEC into the Ethereum Foundation. This could give the commission regulatory coverage to define ETH as a security.
The other day, it was reported via GitHub that the foundation could be under investigation “from a state authority.”
More U.S. companies received subpoenas from the SEC, and the authority requested that they provide documents and financial records related to their dealings with the Ethereum Foundation.
Gary Gensler refuses to answer questions
SEC Chair Gary Gensler has refused to answer direct questions regarding ETH’s potential qualification as a security under the commission’s purview. This comes after he claimed BTC, ETH and others were not labeled as securities back in 2018.
SEC has approved ETFs tied to ETH futures but it did not decide whether to approve or deny spot ETH ETFs, although more experts are awaiting a decision by May.
If Gary looks slim, it’s because he’s been eating nothing but his own words since 2018.
“Bitcoin. Ether. Litecoin. Bitcoin Cash. Why did I name those four? They’re not securities.”
“Three-quarters of this market is probably not securities.” pic.twitter.com/wdgWcxw4h4
— Sam Lyman (@SamLyman33) June 12, 2023
This investigation coincides with a period of important developments for Ethereum. Recently, the blockchain received a major upgrade – Dencun that aims to reduce transaction fees.
If the SEC decides to move forward and regulate ETH, this could result in placing the regulator in conflict with the U.S. Commodity Futures Trading Commission.
Back in 2023, lawmakers with the U.S. House Financial Services Committee and House Agriculture Committee released a draft discussion offering certain cryptos a pathway to being labeled as digital commodities.
Regarding Ethereum, the project’s developments are moving forward, and developers have initiated a new move to increase the blockchain network’s gas limit, which has remained the same for a long time. They believe that this change can aid in scaling Ethereum.
Yesterday’s announcement affected ETH’s price which dropped to about $3,200.

At the moment of writing this article, ETH’s price surged back to over $3,500, and the coin is still trading in the green on CoinMarketCap.