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Blockchain software company Consensys on Thursday announced it is suing the U.S. Securities and Exchange Commission (SEC) in a lawsuit aimed at ensuring Ethereum’s status as a non-security.
The lawsuit, filed in the Northern District of Texas, comes amid ongoing regulatory uncertainty surrounding the world’s second-largest blockchain platform.
Consensys Accuses SEC Of “Unlawful Regulation”
Consensys argues that the SEC is overstepping its authority by attempting to regulate ether, the native cryptocurrency of the Ethereum network.
They point to the SEC’s past statements acknowledging Ether as a commodity, not a security.
“The SEC cannot be allowed to arbitrarily expand its jurisdiction to regulate what is plainly and by the SEC’s own prior admission a commodity,” said Joe Lubin, Consensys CEO and Ethereum (CRYPTO: ETH) co-founder, in a press release.
Potential Impact On Innovation
The lawsuit highlights the potential negative consequences of the SEC’s actions.
Consensys argues that classifying Ether as a security would stifle innovation within the Ethereum ecosystem.
“The SEC’s approach would make it impossible for developers in the U.S. to build on Ethereum,” the press release states.
“It would misclassify non-financial platforms as financial applications and effectively end U.S. transactions in ether.”
Also Read: Bitcoin Options On Hold: SEC Delays Decision, Seeks Public Input
Consensys Calls For Industry Support
Consensys is seeking a court ruling that confirms the SEC’s lack of authority over ether, user-controlled software interfaces built on Ethereum, and the Ethereum blockchain itself.
The company is also calling for industry-wide support in its fight against the SEC’s regulatory actions.
“We are taking decisive, proactive steps on the industry’s behalf at this critical moment for the future of Ethereum, other decentralized protocol technologies and indeed the entire next chapter of the internet’s development. We are committed to the cause and resolved to win,” Lubin added.
The Future Of Ethereum: A Discussion At Benzinga’s Upcoming Event
The Benzinga Future of Digital Assets event, scheduled for Nov. 19, will bring together industry leaders, legal experts, and policymakers to discuss the future of digital assets and the evolving regulatory landscape.
Read Next: a16z Crypto CTO Slams Memecoins, But Are They The Real Threat?
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Posted In: $ETH
