The U.S. Securities and Exchange Commission (SEC) has indicated that it views Ethereum, the second-largest cryptocurrency as a non-security, in its settlement with the cryptocurrency trading platform eToro.
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As part of its settlement deal with the agency, eToro has agreed to halt trading activity in virtually all cryptocurrency assets apart from Ethereum, Bitcoin, and Bitcoin Cash.
The eToro trading platform has agreed to shell out a relatively measly $1.5 million fine.
It was accused violated Section 15(a) of the Exchange Act by acting as a broker and acting as a clearing agency. The SEC also alleged that eToro acted as a custodian and securities depository. However, the SEC did not bring or settle charges with eToro.
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Last July, the Israeli investment platform moved to ditch Dash (DAH), Algorand (ALGO), and other cryptocurrencies after they were named as securities by the agency.
In August 2023, eToro was also sued by the Australian markets regulator over its leveraged derivative contract that made it possible to speculate on crypto.
The lack of clarity
Legal expert Drew Hinkes has explained that private settlement orders are not precedential, which means that Ethereum’s security status remains unclear.
SEC Chair Gary Gensler has repeatedly refused to comment on Ethereum’s security status.
As reported by U.Today, the SEC boss hinted that the Ethereum token could be an unregistered security in his interview with New York Magazine.
In June, the SEC dropped its investigation into Ethereum 2.0 in a big win for the cryptocurrency.
