Key Points
- The US SEC has reportedly launched an investigation into the Ethereum Foundation.
- The investigation coincides with the market’s anticipation of approval for a spot Ethereum ETF.
The US Securities and Exchanges Commission (SEC) is said to be investigating the Ethereum Foundation. This non-profit organization is responsible for the development and governance of the Ethereum blockchain.
Ethereum Under SEC’s Radar
The SEC’s investigation into the Ethereum Foundation comes as the cryptocurrency, Ethereum (ETH), is now the second largest in the market. The SEC has reportedly started a legal campaign to classify Ethereum as a security and has issued subpoenas to various companies in connection with the investigation.
The SEC is seeking information and financial records related to these companies’ relationship with the Ethereum Foundation. This investigation began shortly after Ethereum underwent a major technical change, switching its consensus mechanism from Proof-of-Work (PoW) to Proof-of-Stake (PoS).
Ethereum ETFs and the Investigation
The investigation comes at a time when the market is expecting the SEC to approve a spot Ethereum ETF. This has caused excitement within the crypto community, especially among Ethereum enthusiasts. The first application for this ETF came from Blackrock, a large investment management firm.
Blackrock filed for a spot ETH ETF shortly after receiving approval for its spot Bitcoin ETF earlier this year. This move was quickly followed by other players including Fidelity, Hashdex, and ARK Invest. Fidelity is also reportedly considering offering traders the option to stake a portion of their holdings.
The ongoing investigation’s impact on these applications remains unclear. Most recently, the SEC delayed the decision on VanEck’s spot Ethereum ETF, just a day after postponing the decision on Hashdex Nasdaq and ARK 21 Shares Ethereum ETF applications.
