U.S. Lawmakers Urge SEC to Address Ether Regulatory Uncertainty Amid Custody Service Plans : omgfin

U.S. Lawmakers Urge SEC to Address Ether Regulatory Uncertainty Amid Custody Service Plans Print

Modified on: Wed, 27 Mar, 2024 at 1:20 AM

U.S. lawmakers have raised concerns over the Securities and Exchange Commission's (SEC) handling of Ether (ETH) and its classification as a security. In a letter to SEC Chair Gary Gensler, lawmakers highlighted the potential consequences of leaving Ether in regulatory limbo between the SEC and the Commodity Futures Trading Commission (CFTC), particularly in light of crypto firm Prometheum's plan to offer institutional custody services for Ether. The letter underscores the need for regulatory clarity to prevent irreparable consequences for the digital asset markets.

Lawmakers from the United States House Financial Services Committee and House Agriculture Committee have expressed concerns regarding the regulatory uncertainty surrounding Ether (ETH) and its classification by the Securities and Exchange Commission (SEC).

In a letter addressed to SEC Chair Gary Gensler, lawmakers highlighted the potential consequences of leaving Ether in regulatory limbo, particularly in light of crypto firm Prometheum's intention to offer institutional custody services for Ether. The letter emphasized the need for regulatory clarity to prevent irreparable consequences for the digital asset markets.

The letter pointed out the discrepancy between the SEC's stance on Ether as a security and the Commodity Futures Trading Commission's (CFTC) recognition of Ether as a "non-security digital asset." Lawmakers urged the SEC to address this issue promptly, citing the extensive public record identifying Ether as a non-secure digital asset and warning of potential conflicts with the CFTC's regulatory authority.

The SEC's recent claims suggesting its intention to classify Ether as a security have raised concerns among experts, particularly regarding the approval of spot Ether exchange-traded funds. While the CFTC has recognized cryptocurrencies like Bitcoin and Ether as commodities, the lack of comprehensive guidance from the SEC has exacerbated uncertainty in the digital asset ecosystem.

The letter to Gensler urged the SEC to propose clear rules or provide comprehensive guidance for the digital asset marketplace regarding asset classification to address regulatory uncertainty effectively.

In conclusion, lawmakers emphasized the importance of regulatory clarity to ensure the stability and growth of the digital asset markets, particularly in the face of evolving crypto-related activities and services.

(TURNER WRIGHT, COINTELEGRAPH, 2024)

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