SEC Chair Won’t Comment on Whether Ethereum is a Security

The chairman of the US Securities and Exchange Commission, Gary Gensler, during a recent interview has refused to be drawn into conversations about if Ethereum is an unregistered security or not.

SEC Declines to Comment on Ethereum Question

During the interview, which was held by CNBC, the boss of the financial watchdog stated that the commission does not talk about specific projects nor does it give legal advice over the airwaves.

In his words,

We don’t get involved in these types of public forums, talking about any one project, one possible circumstance and give legal advice over the airways that way.”

The question was asked in relation to the ongoing litigation between the SEC and Ripple. According to the Gensler-led organization, Ripple’s native token, XRP is an unregistered security which the crypto firm alongside some of its top executives sold for profits.

While Ripple has constantly denied any wrongdoing, it has claimed that the SEC lawsuit was targeted at it and that authorities in Japan have stated that the XRP token was not a security. This, they believe, should count in their stead in the ongoing lawsuit.

Ripple Requests for SEC Docs on Ethereum

Apart from this, the crypto firm, as part of its defense, had filed for documents of the SEC on how it determined that Bitcoin and Ethereum, the two largest crypto-assets by market cap, were not securities.

Interestingly, the SEC has refused to provide these documents stating that the documents would be classified as privileged information. This is despite the fact that Judge Sarah Netburn ruled that the commission should furnish Ripple with documents discussing Bitcoin, Ethereum, and XRP. 

Per her judgment,

Intra-agency memoranda or formal position papers discussing Bitcoin, Ethereum, and XRP must be searched for and produced subject to a privilege assertion. Examples of such documents include Division reports, final reports of internal working groups, or formal position papers submitted to the Commissioners.

Gensler Discusses Regulations in Crypto

The SEC chairman during his interview also touched on the subject of regulations in the crypto industry. Gary Gensler noted that too many projects in the space were not regulatory compliant.

He continued that these projects usually tend to claim to be something else so as not to register with the commission whereas many of them are securities.

The SEC, under Gary Gensler, has repeatedly urged crypto projects to register with the commission in order to further protect members of the public.