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Ethereum Co-Founder Speaks Out Against SEC’s Actions
Joseph Lubin, one of the co-founders of Ethereum and the founder of Consensys, recently addressed the behavior of the Securities and Exchange Commission (SEC) of the USA towards cryptocurrencies.
Lubin’s Critique of the SEC’s Approach Towards Ethereum
- Lubin believes that the SEC perceives Ethereum as a threat to the banking sector and is taking steps to impede innovation in the country.
- According to Lubin, the SEC is not engaging in open discussions with the crypto industry but instead resorting to strategic enforcement actions.
- The lack of regulatory clarity and the SEC’s actions are hindering innovation in the cryptocurrency space, ultimately impacting the financial landscape of the US.
- He argues that the SEC’s actions are creating fear and uncertainty within the industry, possibly pushing companies to move operations offshore.
Challenges Faced by Ethereum in its Interactions with the SEC
- Consensys, a company founded by Lubin, has decided to take legal action against the SEC after receiving a Wells notice from the agency.
- The lawsuit aims to seek greater clarity from the SEC through judicial proceedings in the US court system.
- Despite the classification of Ether as a commodity by the Commodity Futures Trading Commission, the SEC’s actions continue to impact Ethereum.
Potential Impact of SEC’s Decision on Ethereum and Banks
- Ethereum faces a deadline for the approval or rejection of Ethereum spot ETFs by the end of May 2024.
- Lubin suggests that the SEC’s decision may hinge on capital inflows for Bitcoin spot ETFs and the readiness of traditional financial institutions.
- The movement of assets into digital forms through decentralized finance constructs may unsettle banks and other financial entities.
Innovations in Ethereum: Buterin’s EIP-7702 Proposal
On a different note, Vitalik Buterin, the other co-founder of Ethereum, presented a groundbreaking proposal alongside Sam Wilson, Ansgar Dietrichs, and Matt Garnett:
- The EIP-7702 proposal aims to enhance the concept of “account abstraction” on the Ethereum network.
- It introduces a new feature that allows externally owned accounts to temporarily function as smart contracts during transactions.
Hot Take: Challenges and Opportunities Ahead for Ethereum
As the debate between Ethereum and the SEC continues, the cryptocurrency industry faces a pivotal moment in its evolution. The actions of regulatory bodies like the SEC can either stifle innovation or pave the way for responsible growth within the sector.