TL; DR
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The SEC just filed a lawsuit against Consensys (the makers of MetaMask), claiming that their staking services are “offered and sold as investment contracts and [are]so certainties.”
Full story
If you grew up with a younger sibling, you’re probably familiar with the following type of scenario:
Mom tells you to stop hitting each other → but you still have revenge to get → so start destroying your sibling’s toys.
(Sure, you just ripped off the head of Eric’s beloved childhood teddy bear… but you’re still adhering to your mother’s orders not to hit each other).
Well, it turns out that old habits die hard.
The SEC may have stopped attacking Ethereum, but now it is attacking the companies that support it.
Specifically: Consensys (makers of the world’s most popular Ethereum wallet, MetaMask).
This time, they claim that MetaMask’s staking services are “offered and sold as investment contracts and [are]so certainties.”
Much to our family’s disappointment, we are not lawyers…
But this feels like one of the longer shots the SEC has taken in recent memory.
They just categorized Ethereum (and by proxy/precedent, Ethereum-like products) as commodities (‘things’ like oil and gold) – i.e. not securities (companies).
Staking pays users interest on their ETH (a commodity), the same way banks pay customers interest on their cash holdings (also a commodity)…
So the SEC is about to hear a case where the biggest hurdle has been self-imposed (the recent categorization of ETH as a commodity).
We don’t understand. But it’s nice to know that they’re probably fighting a losing battle.
