The U.S. Securities and Exchange Commission issued subpoenas to firms that dealt with the Ethereum Foundation, reports Fortune, citing people familiar with the matter.
Individuals from companies receiving the subpoenas said the inquiries were highly specific to the Ethereum Foundation. In addition, some firms received subpoenas recently, while others obtained theirs after Ethereum switched to a proof-of-stake consensus system in September 2022 in a transition dubbed "The Merge."
Fortune reports that the regulator's investigations also required firms to provide documents and financial records related to Ethereum Foundation interactions. The Ethereum Foundation is a non-profit based in Switzerland that develops and manages the Ethereum blockchain. The SEC's move raises questions about whether it is part of a broader push to classify ether as a security, possibly dashing hopes that the regulator will approve spot ether exchange-traded funds in the coming months.
Shortly after The Merge, SEC chair Gary Gensler stated that tokens in a PoS consensus system could be considered securities since investors rely on the efforts of others to make a profit. Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures.
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