NewsletterAfter Gary Gensler Ethereum Stance, Prosecutors Unite Over Cryptocurrencies
U.S. Securities and Exchanges Commission chairman Gary Gensler sparked a debate with his new stance on regulating staked crypto assets. Following the successful completion of Ethereum Merge on Thursday, the SEC chief made a comment on assets that are staked. He hinted that assets like Ethereum (ETH) might have to go through a scrutiny on its ability to allow staking. Gensler, however, did not explicitly subjected his comments to Ethereum’s staking mechanism.
Until recently, the SEC, led by Gensler, was quite adamant on treating Bitcoin and Ethereum as securities. It was only earlier this month that the SEC stated its stance on regulating cryptocurrencies. Gary Gensler had recently supported the idea of CFTC’s oversight on crypto exchanges operating in the country. In what appears to be a clean up of the unregulated crypto industry, even the judicial affairs are going through an overhaul.
Federal Prosecutors Unite To Fight Crypto Crimes
With an aim to better fight crimes associated with cryptocurrencies, the Justice Department decided to unite prosecutors from across the country. According to a Wall Street Journal report, around 150 federal prosecutors across the country came together to bolster law enforcement’s efforts. A department official said,
“The Digital Asset Coordinators Network is intended to designate subject-matter experts in U.S. attorneys’ offices on the complex technical and legal complications posed by cryptocurrency cases.”
Gary Gensler – Crypto Staking And The Case Of Ethereum
Right after Ethereum had officially completed The Merge – the transition to the proof of stake consensus, Gensler made the comments. He said crypto assets that allow staking would have to qualify a test on whether the assets are securities are not. Before this, the SEC chief was otherwise fine with Ethereum being a commodity.
“Crypto assets and intermediaries that allow users to stake will have to pass the Howey Test to determine whether that asset is a security or not.”
The Howey test refers to an eligibility criteria on whether the transaction is an investment contract.
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