In a recent revelation from COINOTAG News, dated May 7th, significant disclosures have emerged from SEC documentation categorized by Coinbase. These files indicate that during the ongoing litigation involving the cryptocurrency exchange KuCoin, New York Attorney General’s Office advocated for the U.S. Securities and Exchange Commission (SEC) to officially designate Ethereum as a security. New York’s Investor Protection Bureau Director, Shamiso Maswoswe, emphasized the importance of filing an amicus brief to support this viewpoint, arguing that a court ruling deeming ETH as a security could enhance investor protection.
Despite this initiative, the SEC has not addressed the request from New York’s legal framework, opting for a more ambiguous approach to Ethereum’s classification. Initial indications suggested the SEC favored categorizing ETH as a commodity, yet their perspective has shifted, particularly after Ethereum transitioned to a Proof of Stake (PoS) model. New York’s regulatory landscape is distinguished by its Department of Financial Services, which governs both securities and commodities. The appointment of the crypto-friendly Paul Atkins as the SEC chair under the Trump administration has somewhat relaxed U.S. cryptocurrency regulations. Recent SEC communications have clarified that not all digital assets are classified as securities, further spotlighting the ongoing discord between federal and state regulatory entities.